Major Currencies Overview
Just when the dollar seemed in for another week of mixed price action, the upbeat NFP report swooped in to save the day and carry the Greenback to second place.
This time, the FOMC minutes might turn out to be the main event as traders are hoping to get more clues on how long policymakers want to delay their next hike. Read more.
It was a mostly negative week for the Loonie as the currency was bogged down by fundamentals, but crude oil’s strong run kept a lid on some losses.
There are no major reports coming up from the Canadian economy this week, but the OPEC meetings are on the docket and any major announcements could spur oil-related action again. Read more.
EUR & CHF
The euro had its fair share of ups and downs in the previous week while the franc had to weather remarks on negative rates from SNB official Schlegel.
The ECB monetary policy decision is due next, and this might reinforce dovish views as data has mostly been downbeat since the March statement. Oh, and there’s the EU emergency summit to think of, too! Read more.
Sterling was able to pull out some wins against its rivals on hopes of a Brexit breakthrough and perhaps another extension on the breakup date.
It should all come down to the EU Brexit Summit this week as leaders have the final say on whether or not to delay the official date past April 12. There might be a couple more options on the table as well. Read more.
The yen chalked up another week deep in the red, except against the Kiwi. Risk-taking weighed on the lower-yielding currency, along with downbeat results from Tankan and Markit surveys.
It’s a relatively quiet economic calendar for Japan, save for a few low-tier releases, so risk sentiment could still be the main driving force for yen pairs. Read more.
The Aussie snagged the top spot in the past week, driven mostly by upbeat Chinese data and upbeat reports from Australia itself.
Another batch of major reports are lined up from China, so these could dictate market sentiment for the week once more. Apart from that, low-tier leading indicators could also provide clues on how the next bigger ones might turn out. Read more.
The Kiwi was unable to jump on the risk-taking bandwagon or join its buddy the Aussie in rallying as the RBNZ’s dovish shift was still fresh.
There are no major reports due from New Zealand this week so it could be a battle between easing expectations and sentiment once more, unless those combine forces to drag the Kiwi lower. Read more.
Charts to Watch:
It’s a channel within a channel! AUD/USD has been trending lower inside a descending channel that’s been holding since February this year but also has been trading at the top half for nearly a month.
Price is bouncing off the resistance and might be due for a dip, either to the very bottom of the large channel at .6900 or the mid-channel area of interest closer to the .7000 major psychological mark. Stochastic is pointing down to indicate bearish momentum but is also nearing the oversold region.
Here’s one for those who like to play with fire! GBP/NZD has been consolidating in a relatively tight range visible on its 1-hour time frame, but could be due for a big breakout in any direction.
Price is hovering close to the resistance while stochastic approaches overbought levels, hinting that another move to the bottom might be due. Still, keep an eye out for a long bullish candle popping above the range top that might signal a longer-term rally is next!
If you’re hoping to trade the news this week but inclined to stay away from potential fireworks, this trend setup on EUR/JPY might be worth keeping on your radar as the ECB statement draws near.
This pair is just testing the top of the descending channel on the 1-hour time frame and might be poised to head back to the bottom around the 123.00 handle or the mid-channel area of interest at 124.00. Just be careful since stochastic is already indicating oversold conditions, so another test of the resistance might be due.