EUR/USD: no love for the common currency
|EUR/USD Current Price: 1.1159
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After a quiet start of the day, the dollar finally lost steam after Wall Street's opening, to close the day generally lower across the board. The common currency however, remained under pressure, as the EUR/USD pair intraday recovery stalled at 1.1165. In the data front, Germany released a couple of confidence indexes, with the IFO survey coming in much better-than-expected, as in May, business confidence increased to 107.7 from a previously revised 106.7, whilst expectations also rose up to 106.6 from previous 100.5. The GFK Consumer confidence for June, resulted at 9.8, beating expectations of 9.7.
In the US, trade deficit widened less-than-expected, up to $57.5 billion last month from a final reading of $57.1 billion in March, and against the $-60.1 billion expected. The greenback held on to gains after the release of this last, but the Flash Markit services PMI weighed on the American currency, down to 51.2 in May from an upwardly revised 52.8.
The EUR/USD pair recovered from a fresh 2-month low of 1.1128, but the upward potential remains well-limited, as in the 4 hours chart the technical indicators are barely correcting oversold readings, whilst the 20 SMA keeps heading lower above the current level, now around 1.1285. In the same chart, the 100 SMA has crossed below the 200 SMA in the 1.1320/40 region, reflecting the strength of the bearish move. A major static support comes at 1.1120, and a break below it should signal a steady bearish continuation towards 1.1040.
Support levels: 1.1120 1.1080 1.1040
Resistance levels: 1.1200 1.1245 1.1280
EUR/JPY Current price: 122.96
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The EUR/JPY pair surged as the Japanese yen came under selling pressure, due to the strong upward momentum in worldwide stocks. BOJ's Governor Kuroda spoke at the Japanese parliament this Wednesday, reiterating that the Central Bank is ready to act if the yen strengthens too much. Indeed, nothing the marked didn't already know. Anyway, the macroeconomic calendar was scarce in the Asian session, and will remain so for this Thursday, with Japan releasing some minor figures that can hardly affect the market. Technically, the intraday recovery seems not enough to reverse the negative tone in the pair, and the short term picture suggest it may resume its decline during the upcoming hours, as in the 1 hour chart, the price is now stuck around its 100 SMA, whilst the technical indicators have turned south within positive territory. In the 4 hours chart, the 100 SMA stands at 123.20, acting as immediate resistance, whilst the technical indicators have merely crossed above their mid-lines, before losing upward strength. Should the price fall back below 122.50, the immediate support, the risk will turn back south, eyeing an extension below the 122.00 level.
Support levels: 122.50 122.00 121.60
Resistance levels: 123.20 123.60 124.00
GBP/USD Current price: 1.4708
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The GBP/USD pair kept rallying on Wednesday, reaching a fresh 3-week high of 1.4728. The Sterling was underpinned by increasing evidence that the "remain" vote will likely end up winning the UK referendum. There were no relevant news in the UK, although this Thursday, the kingdom will release the second estimate of the Q1 GDP, initially estimated at 0.4%. In general, market is expecting a soft reading, in line with the macroeconomic figures released lately, which means that a reading of 0.4% or higher can support further Pound advances. Ahead of the Asian opening, the pair settled above the 1.4700, with a short-lived retracement in the US afternoon having met buying interest around 1.4685. In the 4 hours chart, the upward momentum is still strong, although the RSI indicator has turned flat around 70. Nevertheless, and with the pair having broken above the daily descendant trend line coming from early May high, the pair seems ready to extend its gains up to 1.4770 initially, with scope to extend up to 1.4920 should the mentioned resistance give up.
Support levels: 1.4685 1.4640 1.4600
Resistance levels: 1.4730 1.4770 1.4815
USD/JPY Current price: 110.16
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The USD/JPY pair rallied up to 110.44 this Wednesday, but pared gains as the dollar lost its charm on the back of poor US services PMI readings for the month of May. The sharp advance in worldwide stocks, however, has once again weighed on safe-haven assets. Having retreated some 30 pips from the mentioned daily high, the pair short term picture shows an increasing downward potential, as in the 1 hour chart, the technical indicators head south, but hold within positive territory, whilst the 100 SMA stands horizontal around 109.90, providing an immediate support. In the 4 hours chart, the technical indicators have also lost upward strength above their mid-lines, with the RSI accelerating its decline. In this last time frame, the 100 SMA advanced below the 200 SMA, with both converging in the 108.80/90 region. A break below this last then, should be the kick start to a downward continuation, down to 108.70.
Support levels: 109.90 109.50 109.20
Resistance levels: 110.60 111.00 111.45
AUD/USD Current price: 0.7199
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Commodity-related currencies recovered modestly at the beginning of the day, supported by a strong rally in Asian share markets that extended into early London. The AUD/USD pair advanced up to 0.7218, but was unable to hold on to gains beyond 0.7210, the 61.8% retracement of this year's rally. Data from Australia released at the beginning of the day showed that skilled vacancies picked up +0.6% in April, with a small pickup in the annual rate being a positive lead for employment. Construction Work Done however, came in weak for the Q1 at -2.6%. Overall, the downward trend remains firm, and although an upward corrective movement can't be disregarded, given the sharp decline seen in the last month. For the upcoming hours, the 1 hour chart suggests that the pair can extend its recover beyond the mentioned daily high, as the price is currently moving above a mild bullish 20 SMA, whilst the technical indicators have turned higher around their mid-lines. In the 4 hours chart, the downward strength has eased, but there are no technical signs that the pair can recover from current levels, given that the 20 SMA keeps capping the upside, whilst the technical indicators have turned modestly higher, but remain within bearish territory.
Support levels: 0.7145 0.7100 0.7060
Resistance levels: 0.7215 0.7250 0.7290
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