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Overall, the currency market moved a little lower compared to the dollar during the overnight, as both crude oil and the S&P futures lost ground since the Thursday session began. Today, the European session is expected to be lighter but not without a lot of shoveling, as the major currencies position themselves ahead of a very busy U.S. economic release calendar. At 8:30am EDT, the financial market expects the infamous NFP release, and at the same time, Mr. Trichet’s press conference. Both releases are known to create strong volatility in the fx market, so most likely, the market may make some unpredictable moves at that time.
The Euro (Eur/Usd) lost around 40 pips during the Asian session, practically moving in-line with the other major pairs. The euro is expected to move on a somehow weaker momentum during the first part of the day, but then increase gradually as the market heads into the U.S. open. The next major resistance area for the euro is around 1.4200, the place close to where the pair topped on Wednesday.
The Pound (Gbp/Usd) traded around the neutral pivot point (1.6470) during the Asian session, as investors wait for the market to position itself ahead of the U.S. session. The next major swing point is the 1.6600 area, which has held the pair for almost a month, and the 1.6350 area, where the 20-day moving average is located. During the European session, the BoE will release the Credit Conditions Survey, but historically speaking, this release has little influence over the fx market.
The Aussie (Aud/Usd) continues to trade on weak momentum, but still, the aussie was able to break below the 30-pip range where it spent most of Wednesday. Later in the day, the aussie will probably experience a surge in volume and momentum, as the market is heading towards a very busy U.S. calendar.
The Cad (Usd/Cad) came to a virtual standstill during the Asian session, as the pair moved less than 15 pips. This comes after the cad declined 150 pips on Wednesday. On the 4-hour chart, the cad seems to be forming an upside channel.
The Swissy (Usd/Chf) slowly moved higher during the Asian session, extending the uptrend started throughout the late U.S. session. On the daily chart, the 1.0800 area seems to be the next major resistance point. During the early part of the European session, a member of the SNB voting committee is expected to speak, something that may move the swissy.
The Yen (Usd/Yen) opened the new day of trading just below the resistance area formed by the 20 and the 50-day moving averages. From the pair’s action seen on Wednesday, it is likely that the yen will have a hard time breaking any higher.
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