EUR/USD
Even though EUR/USD settled lower on Wednesday, Tuesday’s settlement above the key 38% retracement of the February to April sell-off at 1.3115 suggests that the pair may now extend gains towards mid 1.3200 levels. Technically, the next resistance level is seen at 1.3344, which is the 62% retracement of the move. There was little in terms of EU related macroeconomic commentary, but Cyprus finance minister said that he anticipates a gold sale in the next few months and that the sale was a Troika decision and is subject to central bank approval. In addition to that, ECB's Weidmann said that the ECB may adjust interest rates if new info warrants a cut, but ECB's rate stance isn't key issue for Eurozone economy. Furthermore, Cypriot deal shows need for "pecking order" in bank rescues.
GBP/USD
The pair trended lower on Wednesday, underpinned by the release of the latest MPC meeting minutes, as well as the release of less than impressive jobs report. Technical support levels are seen at 1.5178, the 62% retracement of the January to March sell-off and then at 1.5122. The BoE MPC voted 6-3 to keep QE unchanged at GBP 375bln and 9-0 to keep interest rates unchanged at 0.50%. Some see merit in possible FLS extension to boost lending and a minority said more QE could smooth economic adjustment. Some MPC members worried more QE might worsen upward drift in inflation expectations, weaken GBP.
USD/JPY
Even though the pair remains in a bullish trend, it looks increasingly likely that another positive catalyst is required for the pair to break through the psychologically important 100.00 level. Going forward, market participants will get to digest the latest foreign buying data, which may encourage the JPY bears and in turn facilitate another surge to the upside by the pair. Technically, resistance levels are seen at 98.36, the 62% retracement of the latest sell-off, followed by 101.45, the April 2009 high and then at 105.75, the 62% retracement of the June 2007 to October 2011 sell-off.
Even though EUR/USD settled lower on Wednesday, Tuesday’s settlement above the key 38% retracement of the February to April sell-off at 1.3115 suggests that the pair may now extend gains towards mid 1.3200 levels. Technically, the next resistance level is seen at 1.3344, which is the 62% retracement of the move. There was little in terms of EU related macroeconomic commentary, but Cyprus finance minister said that he anticipates a gold sale in the next few months and that the sale was a Troika decision and is subject to central bank approval. In addition to that, ECB's Weidmann said that the ECB may adjust interest rates if new info warrants a cut, but ECB's rate stance isn't key issue for Eurozone economy. Furthermore, Cypriot deal shows need for "pecking order" in bank rescues.
GBP/USD
The pair trended lower on Wednesday, underpinned by the release of the latest MPC meeting minutes, as well as the release of less than impressive jobs report. Technical support levels are seen at 1.5178, the 62% retracement of the January to March sell-off and then at 1.5122. The BoE MPC voted 6-3 to keep QE unchanged at GBP 375bln and 9-0 to keep interest rates unchanged at 0.50%. Some see merit in possible FLS extension to boost lending and a minority said more QE could smooth economic adjustment. Some MPC members worried more QE might worsen upward drift in inflation expectations, weaken GBP.
USD/JPY
Even though the pair remains in a bullish trend, it looks increasingly likely that another positive catalyst is required for the pair to break through the psychologically important 100.00 level. Going forward, market participants will get to digest the latest foreign buying data, which may encourage the JPY bears and in turn facilitate another surge to the upside by the pair. Technically, resistance levels are seen at 98.36, the 62% retracement of the latest sell-off, followed by 101.45, the April 2009 high and then at 105.75, the 62% retracement of the June 2007 to October 2011 sell-off.
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