Overall, the currency market continued to show weak momentum during the overnight session, but as the session progressed, the dollar and Japanese Yen strengthened. S&P futures are continuing to weaken and the markets seem to be erring on the side of caution as we approach the U.S, session. The yen, has managed to break below a very important swing area. Ahead, the market may find additional momentum during the U.S. session, but today’s light calendar will more than likely have a negative influence over the market’s liquidity.
The Euro (Eur/Usd) had no clear direction during Monday’s trading session, even though it tried, at one point, to break lower, inline with the S&P futures. Despite this, the low liquidity seen in the market tonight stopped the pair from pulling the move. Later this week, a release is expected to show that the Euro-area economy contracted 2.1% in the first quarter.
The Pound (Gbp/Usd) traded in similar fashion to the euro during Monday’s trading session. The pair moved side-ways, during the early part of the European session, before moving lower as the session progressed. The pair hit resistance near Friday’s high. Today, the pound is clear of any important releases.
The Aussie (Aud/Usd) declined sharply during the early part of the overnight session, but since then the pair has moved side-ways. Tonight, the aussie declined for the first time in the last nine days of trading, affected by the negative U.S. futures and the weakness experienced in the commodity market.
The Cad (Usd/Cad) traded in a 35-pip range overnight, unaffected by the decline seen in the crude oil market. For now, the cad is trading directly on top of the 1.1450 support level, after declining very strongly over the last few weeks of trade on positive Canadian releases.
The Swissy (Usd/Chf) saw very little movement during the overnight session. In the early Asian session, the swissy almost came to a complete standstill. However, the pair picked up a little momentum during the European session, but still the swissy was unable to move significantly in either direction.
The Yen (Usd/Yen) managed to break below the support area formed by the 20, 50 and the 200-day moving averages during the European session, extending the decline seen on Friday. The pair tried to pull the same move during the Asian trading hours, but the liquidity was too small.