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Overall, the currency market moved on increased volume on Thursday, as the economic calendar of the U.S. session was loaded with top tier releases. Among them, the NFP and the ECB press conference were the two most important, but so far it seems that the market has priced-in the weaker than expected data from the labor market beginning with the overnight session. As such, the major pairs moved mostly side-ways after the 8:30am EDT releases, even though the S&P futures and the commodity market declined at a sustained pace during this period.
The Euro (Eur/Usd) moved most of the time lower on Thursday, something that caused the pair to decline as much as 160 pips and test the 20-day moving average. Moreover, the pair retraced on Thursday every pip it gained the prior day, on Wednesday. During the European session, the euro-area unemployment rate was released at 9.5%, the highest rate since 1999. Moreover, the unemployment rate has been moving higher for more than a year, in which the economy has shed a huge number of jobs. A different report from the euro-area showed that the price producers pay for raw goods has decreased for the tenth consecutive month in May
The Pound (Gbp/Usd) had a very weak overnight session, declining the most among the major currencies. Soon after, the pair turned around and retraced most of the declines seen earlier in the day. During the European session, the BoE released the Credit Conditions Survey, but as expected, this release had little implications on the currency market. Moreover, the Construction PMI was released at 44.5, the first decline posted in the last three months.
The Aussie (Aud/Usd) moved only lower during the Asian and the European sessions. Throughout the U.S. trading hours, the pair continued the downside momentum shortly after the 8:30am EST releases, but afterwards developed a 25-pip side-ways channel. If nothing out of the ordinary happens, the aussie will probably continue trading in this tight range throughout Friday’s Asian session.
The Cad (Usd/Cad) almost came to a standstill during the first part of the day, but then surged higher, moving in a similar fashion with the other major pairs. Moreover, the cad bounced from an important point during the European session, formed by the support area of a 4-hour channel, and from the 50-day moving average. The cad rose 120 pips on Thursday.
The Swissy (Usd/Chf) reached TheLFB R1 (1.0850) area during the overnight session, but since then the pair has failed to move any higher. Moreover, the same 1.0850 area represents a major swing point for the pair’s price action. On the daily chart, the swissy is trading slightly below the 20-day moving average. During the early part of the European session, a member of the SNB voting committee made a public speech, moving the pair very little.
The Yen (Usd/Yen) re-tested the resistance area formed by the 20 and by the 50-day moving averages during the early overnight session, but as expected, the yen failed to break any higher. As the market headed towards the U.S. session, the yen began tumbling at a strong pace along with the S&P futures.
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