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Wednesday, April 19th
Seems that pound’s bulls are feeling exhausted today after yesterday’s huge rally, based on fresh UK PM T.May’s announcement, that forced the GBP/USD pair to refresh its half-year highs just above 1.2900 level, that is almost 4 figures higher than Tuesday’s lows. Yesterday T.May made a statement regarding the potential call for snap elections on June 8th. The market took this announcement as an attempt by the prime minister to consolidate her positions, implying May’s confidence of a win in the election, that could give her a strong mandate to get a good negotiation deal over Brexit. Currently the major is trading around 1.2820 level down from its overnight highs, marked at 1.2858, as the pound corrects lower against its main competitors. Looking ahead, today amid lack of fresh fundamentals the market will stay closely watching for any further developments around the Brexit.
The EUR/USD pair eases part of its yesterday’s heavy gains, however, remaining in a green territory within striking distance of its monthly highs, posted yesterday at 1.0736 spot. However, the euro remains pressured lately ahead of the French election, scheduled for the end of this week, as gap between main presidential candidates remains very tight. Moreover, slight US dollar’s correction is also adding some bearish pressure on the pair this Wednesday. On the other hand, persisting risk-off market’s tone, that is associated with ongoing growth of geopolitical tensions, is limiting pair’s further decline. Now immediate focus shifts toward Eurozone final CPI figures, while lack of fresh fundamental releases from the US economy will leave the pair at the mercy of global market’s sentiments in the day ahead.
The Loonie remains one of the main outsiders of the Asian trading session, despite broad US dollar’s weakness, allowing the USD/CAD pair to refresh its 9-day highs at 1.3411 mark. The offered tone around the CAD can be majorly attributed to oil prices weakness, that recently hit its 11-day lows. Moreover, slight recovery of the greenback is also collaborating with pair’s bullish rally. Today the pair will continue to trace oil price movement, while US EIA oil inventory data will also be able to bring short-term trading opportunities later in NA session.
The AUD/USD pair remains well-offered for the second session in a row, closely eyeing to retake its support level, located at 0.7500, as the market is still digesting Tuesday’s dovish RBA Meeting Minutes. Moreover, ongoing softness of commodities, with drop in the iron ore to its six-month lows, are additionally weighing the Aussie. Meanwhile, prevalent risk-off tone and mild greenback’s correction are also lending extra legs of support to the pair lately. Today in absence of any crucial economic releases, scheduled on this Wednesday, the pair will continue to follow broad RO-RO trend and US price dynamics during this trading session.
The main events of the day:
EU CPI – 12.00 (GMT +3)
US Crude Oil Inventories – 17.30 (GMT +3)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0598 R. 1.0802
USDJPY S. 107.74 R. 109.56
GBPUSD S. 1.2363 R. 1.3143
USDCHF S. 0.9895 R. 1.0079
AUDUSD S. 0.7500 R. 0.7626
NZDUSD S. 0.6983 R. 0.7071
USDCAD S. 1.3276 R. 1.3452
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