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Wednesday, May 10th
Today the EUR/USD pair performed attempt to recover from its nearly 2-week lows, witnessed during last trading session, but faced strong resistance just a few pips before 1.09 level, consolidating its positions in 20-pips narrow range. However, the pair is remaining positive as of late, as slight weakness of the USD is capping it from further decline. On the other hand, prospects of June Fed rate hike, supported by upbeat US fundamentals and slew of hawkish Fedspeaks, delivered recently, continue to cheer up sentiments around the US dollar. Looking ahead, now immediate focus shifts on the ECB President M.Draghi’s speech, that is scheduled on European hours, while the rest of the session will remain relatively quiet, so global market’s sentiments will continue to build pair’s further direction during NY trade.
Seems that the AUD bulls have lost its momentum, allowing the AUD/USD pair to ease some pips after solid recovery from its 4-mont lows, posted yesterday at 0.7329 spot. However, most probably today the pair will keep its positive mood, as prevalent risk-on sentiments, triggered by upbeat Chinese data, and mild optimism in commodity market are keeping demand around the Aussie this Wednesday. Adding to that, slight correction of the US currency is also lending extra legs to pair’s recovery. Today in absence of important data releases from both sides, the pair will stay at the mercy of broad market’s risk sentiments and US dollar’s price dynamics, that will determine its further directional move.
The GBP/USD pair remains well bid in the middle of this week, refreshing its daily highs at 1.2985, in wake of better risk-on sentiments across the market. Furthermore, today the US dollar stalled its 2 days’ upside rally, based on improved odds of a June Fed rate hike, as investors are locking in some profits, thereby providing extra support to the pair. However, further upside remains capped, as investors turn cautious ahead of the BOE monetary policy decision and quarterly inflation report release due tomorrow. Meanwhile, nothing noteworthy is scheduled in data calendar for this Wednesday, so the pair will keep tracing global market’s sentiments to set up its further development course.
Today the NZD/USD pair is trading on a firm note, having finally broken through resistance, located at 0.6900, after several unsuccessful attempts, seen earlier in Asia. Breaking through its resistance and building mildly bullish trend became possible after China published positive data, that showed faster-then-expected inflation growth pace, thereby reigniting risk appetite among investors. Moreover, slight recovery of oil prices, triggered by bullish API report, and downside correction of the US dollar after 2-day northern rally are also collaborating with pair’s upside direction. All eyes now remain on the RBNZ policy decision due in next Asia, while Crude Oil Inventories and bloc of US secondary releases will keep traders busy this Wednesday.
The main events of the day:
ECB President M.Draghi’s Speech – 15.30 (GMT +3)
US Crude Oil Inventories – 17.30 (GMT +3)
Support and resistance levels for the major currency pairs:
EURUSD S. 1.0820 R. 1.0960
USDJPY S. 112.62 R. 115.02
GBPUSD S. 1.2874 R. 1.2990
USDCHF S. 0.9927 R. 1.0163
AUDUSD S. 0.7288 R. 0.7426
NZDUSD S. 0.6854 R. 0.6946
USDCAD S. 1.3631 R. 1.3797
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