Major Currencies Overview
The Greenback had another one of its mixed runs as a number of factors like trade jitters, assurances of a “great deal” from Trump, and the NFP report came in play.
The fireworks won’t be ending for the dollar anytime soon as the FOMC decision is on this week’s docket. Oh, and did I mention there’s this one little thing called the U.S. mid-term elections about to happen, too? Read more.
The Loonie tossed and turned for the most part of the week, drawing support from another set of hawkish BOC hints but having its gains capped by weak crude oil.
There’s not much in the way of major events from Canada this week, save for yet another speech by BOC Governor Poloz and the Ivey PMI release. Read more.
EUR & CHF
Euro pairs appeared to take their cues from opposing currency action while the franc shed a lot of ground when risk-taking returned.
More than a handful of leading indicators are lined up from the euro zone this week while the Swiss franc has no catalysts on deck. Any market factors that could push this duo around? Read more.
Pound bulls continued to keep their hopes up for a Brexit deal, charging even at the slightest hint of an accord even as rumors are dispelled later on. The BOE statement added to sterling’s gains as well.
Some focus could return to fundamentals late in the week when the UK releases its preliminary Q3 GDP but the odds are that Brexit updates would remain front and center. Read more.
The yen took a nasty fall from heights reached much earlier on as risk appetite came back with a vengeance.
It might be a quiet week for the yen as only medium-tier reports are scheduled, but of course an extension of risk appetite’s stay the markets could mean more losses for the Japanese currency. Read more.
Risk-taking and Trump’s assurances of a “great deal” with China, believe me, have lifted the Australian currency for the most part of the previous week.
All eyes and ears may be on trade updates, but the Aussie might have a few more moves up its sleeve as the RBA decision is coming up. No actual policy changes are expected, though. Read more.
The higher-yielding Kiwi outperformed the rest of its forex peers on account of risk appetite and expectations of a trade deal between the U.S and China.
The RBNZ will also be making its monetary policy statement this week and, even though no moves are eyed, traders are keen to find out if this central bank has budged from its not-so-hawkish stance yet. Read more.
Charts to Watch:
Cable might be done with its slide as a double bottom pattern appears to be forming on its 4-hour chart. Price has yet to test and break past the neckline resistance at the 1.3200 handle to confirm that a rally is underway. If that happens, the pair could be looking to climb the same height as the chart formation.
Guppy is also showing its reversal chops, too, and the pair is already testing the neckline of its inverted head and shoulders pattern. A break past this could yield around 800 pips in gains, which is around the same size as the reversal formation.
This pair is pacing back and forth inside its range, finding support at the 1.6650 minor psychological mark and resistance near 1.7250. Price is closing in on the resistance, which might once again hold as a ceiling. A break higher, on the other hand, could spur a rally that’s the same size as the rectangle pattern.