Overall, the Asian session started with a strong dollar, retracing some of the declines seen on Monday. It seems though the dollar weakness came as the Fed intervened in the treasury market, something that will probably happen more and more often. Ahead, the European calendar is clear of any releases, but the U.S. calendar holds a number of top tier releases.
The Euro (Eur/Usd) bounced off the 1.3100 support level and the 100-day moving average to gain 240 pips on Monday. Moreover, the pair led the dollar’s selling wave until the close of the U.S. session. During the Asian session, the euro declined 50 pips.
The Pound (Gbp/Usd) headed higher on Monday, gaining a little more than 200 pips. Additionally, the pound experienced a surge in momentum on Monday, after it almost came to a standstill in the last few days. During the Asian session, the pound had a 30-pip range.
The Aussie (Aud/Usd) reached the highest valuation since October yesterday, helped by the dollar’s weakness. In a day of low volumes, the aussie managed to break above the 0.7200 resistance area. Previously, this price point held the pair since the beginning of April. During the Asian session, the aussie shed 40 pips.
The National Australia Bank released the business confidence report this evening. Business confidence in Australia has improved to -13. The sentiment index gained 9 points from last month’s reading of -22. “Pessimists still outnumber optimists and have done for the past 14 releases, but interest rate cuts have the number of optimists rising meaning that consumer spending may benefit”, TheLFB-Forex.com Trade Team members said.
The Cad (Usd/Cad) fell less than 50 pips on Monday, in a day when the dollar sold off heavily. The cad moves are usually backed by the crude oil market, however, on Monday oil posted strong declines. This was reflected in the overall Canadian dollar’s strength, which was unable to move decisively.
The Swissy (Usd/Chf) bounced off the 50-day moving average in the early part of the overnight session, and dropped 240 pips soon after. In its downward path, the swissy broke under the 20,100 and the 50-day simple moving average, paring the gains seen last week. During tonight’s Asian session, the swissy gained 40 pips.
The Yen (Usd/Yen) dropped lower in the last day of trading, as the dollar declined against every other major currency. During the Asian session, the yen tried to recover the ground loss on Monday, but was rejected.