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Thursday, March 30th
The GBP/USD pair was deadly quiet in Asia, keeping its range between 1.2430 – 50 marks, as market’s participants are now awaiting for a response of President of the European Council D.Tusk, that is scheduled on tomorrow, to UK PM T.May’s official letter of triggering Article 50, which will be able to provide more information on the two-year long Brexit negotiation process. However, the pair broke out of its consolidation box to downside, as the pound remains under bearish pressure lately in wake of rumors, that EU will penalize UK, which are fueling speculations around hard Brexit. On the other hand, UK remains one of the biggest markets for the EU, so hard Brexit looks unlikely. Nevertheless, further developments around divorce of UK and EU will remain as a key driver for the pound.
The EUR/USD pair is performing minor attempts to recover part of its losses in early Europe, however, remaining highly pressured on the back of upbeat sentiments around the greenback. Moreover, recent comments of ECB officials, in which they noted that the March statement has been overvalued, are forcing the pair to expand its retreat from Monday highs, posted at 1.0906 spot, having lost already more than 150 pips. Adding to that, several Fedspeaks, witnessed during this week, which are favoring two more Fed rate-hikes this year, are also broadly supporting the US currency lately. Looking ahead, today EU docket will bring set of secondary local reports in mid-EU session, while US GDP, scheduled on early NY trading session, will take center stage this Thursday.
The USD/JPY pair changed its course in Asia and now is trading in south direction, as the greenback has stalled its recovery against its major rivals. Moreover, shrinking risk appetite is also providing the yen with extra legs of support in early Europe. However, dovish comments from BOJ deputy governor K.Iwata, noting that it would be reasonable to continue its monetary policy easing program until inflation level reaches 2%, negatively affected the yen, thereby limiting its further gains. Now all focus shifts on the US GDP report that is scheduled on NA session and will provide investors with extra short-term trading opportunities.
The AUD/USD pair paused its two-day bullish rally at the 0.7676 spot and eased part of its gains amid renewed demand for the greenback, that is backed by yesterday’s strong US Pending Home Sales. Moreover, weaker sentiments around commodities, especially in copper, and broad risk-off moods are also negatively influencing the Aussie this Thursday. Today USD pricy dynamics and RO-RO trend, majorly based on Brexit talks, will continue to drive the pair, while the US economy will release GDP numbers in NA session, which will also be able to set up pair’s further direction.
The main events of the day:
US GDP – 15.30 (GMT +2)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0690 R. 1.0864
USDJPY S. 110.41 R. 111.63
GBPUSD S. 1.2327 R. 1.2529
USDCHF S. 0.9886 R. 1.0014
AUDUSD S. 0.7612 R. 0.7702
NZDUSD S. 0.6975 R. 0.7067
USDCAD S. 1.3270 R. 1.3428
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