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Wednesday, April 5th
The EUR/USD pair stepped away from its 3-week lows, posted yesterday at 1.0636, however, stalled its recovery in mid-Asia in wake of broadly stronger US currency. Seems that EUR bulls got out of steam today, allowing the pair to retreat from its this week highs, marked at 1.0685, in wake of broad demand for the USD. However, recent opinion poll results showed, that far-right candidate M.Le Pen is still behind E.Macron in French election race, thereby lending support to the common currency. Moreover, increasing nervousness ahead of tomorrow’s official meeting between leaders of the two largest economies in the world – US and China, will also provide extra legs of support to the pair. Today all attention turns toward the US ADP jobs report, followed by ISM services PMI and FOMC minutes, which will take center stage during NA session.
The USD/JPY pair bounced off its overnight lows, marked at 110.54, amid steady demand for the US currency, however, still remaining pressured, as prevalent risk-off tone is gripping the market. Today the pair managed to recover some ground during late Asia, as bid tone around the greenback is still remaining one of the main drivers across the market in wake of growing expectations of further aggressive tightening of the Fed monetary policy. However, increasing cautiousness ahead of today’s FOMC Meeting Minutes is limiting any pair’s chances for further recovery. Besides FOMC minutes, today traders will closely watch for US ISM Non-Manufacturing PMI and ADP Nonfarm Employment Change that will be able to shape up market’s expectations of Friday’s crucial NFP report, while broad risk aversion, additionally fueled by tomorrow’s US-China summit, will remain as a key driver for the pair during this session.
Today the NZD/USD pair once again refreshed its multi week lows at 0.6965 in response to broadly higher positions of the US dollar. Moreover, strong risk-off sentiments ahead of key risky events are also driving flows away from higher-yielding assets, such as NZ dollar. However, the Kiwi managed to recover some ground this morning, stepping away from its recent lows, as better tone in commodity prices is supporting the pair somewhat. Now all traders’ attention remains focused on the US economic docket, featuring ADP Nonfarm Employment Change, ISM Non-Manufacturing PMI and FOMC Meeting Minutes, for fresh short-term trading opportunities during NA session.
The GBP/USD pair remained mostly unchanged in early Europe ahead of busy data session, scheduled for this Wednesday. The pair is struggling to recover some ground amid ongoing bid tone around the greenback and lack of news from Brexit front. Moreover, streak of disappointing UK PMIs and increasing cautiousness across the market ahead of crucial economic and political events, scheduled for this week, are limiting pound’s chances for recovery. Looking ahead, today the pair won’t suffer from lack of momentum, as bloc of important releases such as UK Service PMI, US data from labor market, US ISM Non-Manufacturing PMI and FOMC minutes will determine pair’s further direction.
The main events of the day:
UK Services PMI – 11.30 (GMT +3)
US ADP Nonfarm Employment Change – 15.15 (GMT +3)
US ISM Non-Manufacturing PMI – 17.00 (GMT +3)
US Crude Oil Inventories – 17.30 (GMT +3)
US FOMC Meeting Minutes – 21.00 (GMT +3)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0620 R. 1.0704
USDJPY S. 109.97 R. 111.31
GBPUSD S. 1.2375 R. 1.2527
USDCHF S. 0.9996 R. 1.0048
AUDUSD S. 0.7504 R. 0.7644
NZDUSD S. 0.6936 R. 0.7040
USDCAD S. 1.3327 R. 1.3493
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