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Wednesday, August 19th
Japanese yen fell slightly after the country’s Adjusted Balance figure came out in red colour at -0.37T against -0.16T expected. Meanwhile, exports rose more than expected in July, while imports contracted less than predicted by economists. USD/JPY is changing hands at 124.29, which means the ongoing consolidation is still active with support and resistance levels located immediately at 124.06 and 124.60, respectively. The pair is likely to reach the 125 level if, having fallen to 124, it tests the 124.60 area.
EUR/USD is rising after 4 days of consecutive falling ahead of FOMC minutes later in the day. Investors were closing their long positions on this instrument considering unclear indications on the timing of rate hike in the US. A few hours prior to FOMC report, data on American Core CPI and Crude Oil inventories will be published. Meanwhile, European Current account numbers are due to be published this morning, so there will be a higher volatility day for the single currency today. The pair will likely find support at 1.0808 and resistance at 1.1213.
NZD/USD is down today after testing the 0.66 level during the previous session as Russia lifted the ban on NZ dairy products raising hope for a more steady growth in the farming sector of New Zealand Currently, NZD is changing hands at 0.6596 against its American counterpart. Bearing in mind stronger demand for the greenback (the US Dollar Index grew 0.08% to 97.00 overnight), Kiwi was holding quite strong. The currency was partially supported by upbeat PPI Input data, which suggested much slower contraction than the previous quarter.
GBP/USD continues rising after spiking above the resistance level of current consolidation at 1.5690. Yesterday’s upbeat inflation indicators suggested Great Britain is one more step away from the risk of entering the deflation zone. Without any significant data coming out from the UK, the pair is likely to follow the moves of the US dollar and EUR. The expectations continue to be bullish, as British economy continues to show steady growth and technical levels suggest that breaking through the current consolidation ceiling would open up the space for a more intensive bullish trend. GBP/USD is trading at 1.5676.
USD/CAD is back below the key support level located at 1.3063. Trading close to highs of March 2009, the pair might continue the flat trade until the market has more fundamental data on the growth of Canadian economy. In view of long awaited rate hikes in the US, the expectations are mostly bullish. However, the RSI indicator clearly suggests the pair might have been well overbought. Any bigger moves will need to be considered as “traps” until the forming of a trend is confirmed. The current quote is 1.3041.
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