Spreads
Spreads
Spreads
Spreads
Spreads
The EURUSD pair advanced on Thursday, ending its slide that started yesterday and recovered toward the 1.072 area amid the risk-on market sentiment. The pair dropped to a daily low below 1.067 level in the late Asian session, but then regained upside momentum and recovered all of its daily losses. The pair is now trading at 1.0718, posting a 0.40% gain daily. EURUSD stays in the positive territory amid a weaker US dollar across the board, as the generally positive tone around the equity markets and downbeat US data both undermined the safe-haven greenback. The US GDP report showed that the US economy contracted by a 1.5% annualized pace during the first quarter of 2022, adding to the concerns about the worsening global economic outlook. For the Euro, the expectations that the European Central Bank could raise rates at some point in the summer keep acting as a tailwind for the pair, as the rising eurozone inflation is pressing the ECB to announce quantitative restrictions.
For the technical aspect, the RSI indicator is 63 figures as of writing, suggesting that the upside is more favored as the RSI stays above the mid-line. As for the Bollinger Bands, the price rose from the moving average and climbed toward the upper band, therefore a continuation of the upside trend could be expected. In conclusion, we think the market will be bullish as the pair is heading to test the 1.0736 resistance. Further gains could be expected if the pair break above that level.
Resistance: 1.0736, 1.0810, 1.0922
Support: 1.0651, 1.0549, 1.0464
The pair GBPUSD edged higher on Thursday, regaining bullish traction, and rebounded slightly from the 1.255 area amid the improving market mood. The pair gather bullish momentum and touched a daily high during the European session, but then lost its strength and surrendered most of its intra-day gains. At the time of writing, the cable rebounds back slightly and stays in positive territory with a 0.02% gain for the day. The minutes of the FOMC’s May policy meeting failed to provide standout hawkish surprises, as market participants now expect that the Fed could pause or slow down the rate hike cycle once rates have reached the neutral level later in the year. For the British pound, reports showed that the UK Chancellor of the Exchequer Rishi Sunak could be about to announce a fiscal stimulus plan for UK consumers and low-income households, which has lent some support to the cable.
For the technical aspect, the RSI indicator is 59 figures as of writing, suggesting that the buyers retain control of the pair’s action as the RSI stays above the mid-line. For the Bollinger Bands, the price regained upside traction and climbed toward the upper band, indicating that the upside momentum should persist. In conclusion, we think the market will be bullish as the pair is heading to test the 1.2605 resistance. On the downside, a four-hour close below the 1.2487 support could favor the sellers and cause the pair to drop toward 1.2430.
Resistance: 1.2605, 1.2631, 1.2761
Support: 1.2487, 1.2430, 1.2341
As the risk-on market mood and the strong rally in the equity markets drove flows away from the US dollar on Thursday, the pair USDCAD extended its slide and refreshed daily lows below the 1.2780 mark. The pair reached a daily top above the 1.2845 level in the late Asian session, but then failed to preserve its upside traction and retreated toward the 1.2780 area heading into the US session. USDCAD is trading at 1.2785 at the time of writing, losing 0.24% daily. The speculations that the Fed could pause or slow down the rate hike cycle later this year exerted some bearish pressure on the greenback, as the Fed could reassess the need for further tightening once rates have reached the neutral level. On top of that, the surging crude oil prices also provided strong support to the commodity-linked loonie as WTI rose to a weekly high near $114 per barrel area. The black gold was underpinned by the expectations for rising oil demand in the US as the peak driving season approaches.
For the technical aspect, the RSI indicator is 41 figures as of writing, suggesting that the downside is more favored as the RSI stays below the mid-line. For the Bollinger Bands, the price remained under pressure and crossed below the moving average, therefore the downside traction should persist. In conclusion, we think the market will be bearish as the pair is heading to test the 1.2767 support. A break below that support will lead to further losses and technical readings also favor a bearish continuation.
Resistance: 1.2859, 1.2902, 1.2966
Support: 1.2767, 1.2725, 1.2687
