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Overall, the dollar strengthened across the board on Wednesday. The dollar’s upside move started shortly after the London open, as the S&P failed to break above the 945.00 resistance area. However, in percentage terms, the decline in the S&P does not justify the strong selling from the currency market. Institutional investors may have accelerated those declines by taking their profits after the market held a strong uptrend the last few weeks. Ahead, the market expects the interest rate decision from the ECB, BoE and the BoC.
The Euro (Eur/Usd) fell as much as 160 pips on Wednesday, erasing every gain made in the previous day of trading. During the London open, the euro made a small attempt to break higher, as the other major pairs did. However, the market’s sentiment turned around very quickly, resulting in the euro and the rest of the market dropping at a very strong pace throughout the Wednesday trading session.  

The Pound (Gbp/Usd) declined nearly 300 pips on Wednesday, the most since early March. The pair’s decline was inline with the other major currencies, retracing the recent bull-run seen in the forex market. Currently, the pound is trading in a 4h upside channel, near the support trend-line.

The Aussie (Aud/Usd) lost 200 pips on Wednesday, shedding every pip made in the previous two days of trading. The aussie declined even though the latest economic releases from Australia are pointing to a very strong economy, one which was still able to expand despite the global recession. 

The Cad (Usd/Cad), except for a small attempt to break lower in the early Asian session, moved only higher during the Wednesday trading hours. The cad gained 310 pips throughout the day, even though it appeared reluctant to move during the overnight session. Moreover, the pair rose the most since November 2008 on Wednesday, reflecting the decline from the crude oil market.

The Swissy (Usd/Chf) rose 100 pips on Wednesday, paring the declines seen on the prior day, Tuesday. During the early session, the pair tested the 1.0600 area trying to break lower, but was easily rejected at that level. Since then, the swissy started too moved only higher until the late U.S. session. During the Asian session, the swissy dropped 30 pips. 

The Yen (Usd/Yen) moved only a fraction compared with the other pairs during the Wednesday trading sessions. The pair gained 35 pips, after it moved most of the day in a 45-pip range. During the Asian session, the yen gained another 40 pips, and is now preparing to test the high reached on Wednesday. 

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