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Overall, the currency market has entered again into a risk-aversion mode, having the major currencies shed every pip gained on Thursday. The market may have been sent lower, as rumors surfaced that IMF is in talks with 10 Eastern European countries, which added a lot of downside pressure to the euro. Going towards the U.S. session, the market is likely to become volatile around the open of the Chicago futures market, but then the momentum will slowly fade away as the Friday close approaches.

The Euro (Eur/Usd) declined 150 pips during the overnight session, shedding every pip it gained in the previous day of trading. For now, the euro is slightly above the 50-day moving average, which provided a strong support area over the last few days of trading. 

The Pound (Gbp/Usd) showed a lot of strength during the overnight session, as rumors emerged that the BoE is planning to end its quantitative easing program, as the economy is showing signs of recovery. Moreover, a release showed that the PPI input jumped 1.5% in June, the strongest read over the last year. As a note, such a strong pace of inflation in the PPI was seen only in the first half of 2008, as oil was heading towards $147. However, the PPI output continued to decline in June, falling 1.2% from one year ago. 

The Aussie (Aud/Usd) headed lower on Friday, during the overnight session. The aussie lost approximately 90-pips, shedding everything gained in the prior day of trading. The pair’s weakness comes as the Chinese economy is showing some signs of faltering, especially as its exports decline.

The Cad (Usd/Cad) had probably one of the most benign Asian sessions on record, moving less than 10 pips. During the London open, the cad picked up a little more momentum, but still it looked reluctant to move anywhere decisively. On the daily chart, the cad appears to be trading in a upward channel.

The Swissy (Usd/Chf) had a very strong overnight session, in which the pair gained approximately 140 pips. Moreover, the swissy moved almost exclusively higher, without too many hesitations. Some are arguing that the SNB might be involved, again. 

The Yen (Usd/Yen) extended the wide-range seen in the prior day of trading throughout the overnight session, even though it had a few attempts to break lower. An analysis of the daily chart shows that, in order for the yen to develop a trend, it would need first to break below the 92.50 area, or above the 93.50 area. 

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