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Wednesday, February 1st
The EUR/USD slips under 1.08 level during Asia in wake of minor correction of the US dollar. Currently the main currency pair is trading near the region of 1.0780 with slight bearish pressure, easing from its eight-week highs, posted yesterday at 1.0812 on the back of recent comments of the US president, in which he noted that other nations devalue their currency to gain competitive advantage. Moreover, disappointing fundamentals from the US economy, seen yesterday, are also adding some pressure on the greenback. Today traders will follow the latest headlines based on D.Trump’s policy, while FOMC interest rate decision will also be able to grab traders’ attention later in NA session.
The pound is losing its positions in the pair with the US dollar after yesterday’s strong gains. Seems that the pair lost its upside momentum after had faced resistance at 1.26 level, falling back to the mid-point of 1.25. Moreover, corrective moves of the greenback after sharp drawdown are also negatively influencing the pair, backed by recent D.Trump’s comments that Germany, Japan and China are devaluing their currencies. Another volatile session is expected today, with Manufacturing PMIs from both sides and FOMC decision that will take center stage later in NA session.
Today the USD/JPY pair continues its recovery, led by recent events on the US economic field, from 2-month lows, marked at 112.08. By the moment of writing the pair was trading at 113.55, as the dollar continues correcting its positions against its main competitors. However, D.Trump’s recent comments coupled with his travel ban will keep pressuring on the US currency. Today in data calendar are scheduled ADP Nonfarm Employment Change and ISM Manufacturing PMI, while Fed interest rate decision will hog the limelight in NA session. Expectedly FOMC will leave its interest rate unchanged, while following statement will be closely watched for any hints on further rate-hikes and monetary policy direction.
The USD/CAD extends its recovery mode from its multi-month, posted at 1.2969. Seems that US bulls have regained control over the pair as higher treasury yields are supporting the greenback across the market. Moreover, overnight sell-off in oil is also collaborating with pair’s bullish run. Today market participants will await for US economic dataset from that includes US EIA crude inventory report, US ADP jobs, ISM PMI and much awaited Fed Interest Rate Decision, that will be eagerly eyed for any cues of Fed’s further monetary policy outlook.
The main events of the day:
German Manufacturing PMI – 10.55 (GMT +2)
UK Manufacturing PMI – 11.30 (GMT +2)
US ADP Nonfarm Employment Change – 15.15 (GMT +2)
US ISM Manufacturing PMI – 17.00 (GMT +2)
US Crude Oil Inventories – 17.30 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0636 R. 1.0892
USDJPY S. 111.05 R. 114.83
GBPUSD S. 1.2344 R. 1.2712
USDCHF S. 0.9801 R. 1.0011
AUDUSD S. 0.7514 R. 0.7640
NZDUSD S. 0.7230 R. 0.7388
USDCAD S. 1.2884 R. 1.3196
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