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Overall, the major currencies posted important gains compared to the dollar on Thursday, which has caused the dollar to lose a little more than 1%. However, unlike in the past few weeks when the fx market moved together with the global market, today, the major currencies had their own way of trading. The dollar sold off strongly, even when the equity markets (which are usually a gauge for risk-aversion) posted small gains, while crude oil moved flat most of the time. It will be interesting to see if the fx market can maintain this momentum over the next few trading sessions, since it usually requires a fundamental driver behind it in order to maintain such momentum.
The Euro (Eur/Usd) is currently trading above TheLFB R3, as the pair advanced 170 pips on Thursday. The euro moved higher most of the time, something that helped the pair break above the 20-day moving average throughout the European session.
The Pound (Gbp/Usd) moved higher most of the time on Thursday, gaining as much as 300 pips. The pair showed a lot of strength even from the first few hours of trading on Thursday, as traders were preparing for the BoE’s interest rate decision. The bank decided to keep rates unchanged, and left the size of the asset buying program also unchanged, despite what many market participants were saying. For now, the pound is trading just below the 20-day moving average.
The Aussie (Aud/Usd) spent an important part of the European trading hours, and the entire U.S. session trying to break above the 50-day moving average, but until now, the pair has failed to do it. During the overnight session, the aussie gained approximately 70 pips.
The Cad (Usd/Cad) headed lower during the overnight session, but retraced some of the recent gains during the U.S. session, even though the rest of the majors continued to advance compared to the dollar. The cad’s hesitation to move lower may have come as the pair failed to break below the trend-line that holds the pair for almost two weeks now.
The Swissy (Usd/Chf) followed the euro very closely on Wednesday, and declined nearly 150 pips. For now, the swissy is trading slightly above the 1.0750 area, which represent the last major support area before the pair can test the lows made throughout June.
The Yen (Usd/Yen) ignored the rest of the market on Thursday, and traded most of the time in a wide range around the neutral pivot point (93.10). In order to move anywhere higher, the yen would have first to break above the 93.50 resistance area.
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