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Tuesday, June 27th
The EUR/USD pair surrendered part of its overnight gains, having faced resistance at 1.1200 level on the European opening, as the market turned cautious ahead of key central bankers’ speeches. Yesterday the pair received strong bullish impetus following solid German business data, however, the spike faded quickly, as the US dollar corrected higher against its main competitors, despite downbeat US Core Durable Goods Orders report. Adding to this, yesterday’s uninformative speech of the ECB President M.Draghi also failed to provide any support to the common currency. Today speeches by the ECB President M.Draghi and Fed Chief J.Yellen will take center stage, as further divergence of monetary policies’ will shape up pair’s next course. Besides key economic events, today the US will release the CB Consumer Confidence report, which will also be able to bring some trading opportunities during NA session.
The pound continues to show positive dynamics amid optimistic talks over the Brexit, sending the GBP/USD major to refresh its daily highs in the region of 1.2740. However, the pound may get under bearish pressure later in the day on the back of the Bank of England’s Financial Stability report and following speech of Mark Carney. It is expected that Mr. Carney will retain his economic view, which suggests refraining from monetary policy potential tightening. This kind of Mr. Carney’s remarks may be taken by the market especially aggressive following last week’s hawkish comments by Chief Economist of the BoE A.Haldane, who stated that monetary policy tightening may be appropriate this year and it would indicate wellness of the current economy. Besides BoE Financial Stability report and M.Carney’s speech, the US docket will provide the market with CB consumer confidence data, while speech of the Fed Chair J.Yellen will take center stage in NA session.
The NZD/USD pair is trading in a bullish trend this morning, extending its winning streak for the fourth consecutive session. Earlier this day the pair received slight bearish impetus after the NZ economy published weaker-then-expected trade balance data. However, the pair managed to bounce off its overnight lows, marked at 0.7275 spot, and recover its retreat on the back of positive risk-on sentiments, that were prevailing during Asian trading session. On the other side, the pair failed to sustain its recovery mode, as oil prices stalled its upside this morning after 4-day winning streak, providing no support to commodity linked assets. All eyes now remain on fresh batch of the US macroeconomic releases, featuring CB Consumer Confidence and several second tier reports, while Fed Chair J.Yellen’s speech will hog the limelight in the NA session.
The dollar/yen pair was unable to hold its positive tone, gained yesterday despite weaker-than-expected US fundamentals, and retreated from its monthly highs, posted earlier today at 112.07. The pair accelerated its downside trend in European opening and refreshed its daily lows at 111.46, as a mildly weaker tone around the dollar is supporting the pair this Tuesday. Adding to this, shrinking risk appetite across the market on the back of several important talks is also lending some support to the safe-haven assets, such as the Yen. Looking ahead, today the US economy will release CB Consumer Confidence, while several Fedspeaks, including speech of the Fed Chairwoman J.Yellen, will remain top market moving events of this Tuesday.
The main events of the day:
BoE Governor M.Carney’s speech – 13.00 (GMT +3)
US CB Consumer Confidence – 17.00 (GMT +3)
Fed Chair J.Yellen speech – 20.00 (GMT +3)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.1142 R. 1.1238
USDJPY S. 110.82 R. 112.46
GBPUSD S. 1.2674 R. 1.2782
USDCHF S. 0.9656 R. 0.9772
AUDUSD S. 0.7542 R. 0.7620
NZDUSD S. 0.7237 R. 0.7335
USDCAD S. 1.3186 R. 1.3300
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