Overall, the majors were driven by the equity markets in the last day of trading. The dollar strengthened overnight, on negative Asian and European markets, but as the U.S. futures reversed, the greenback started to lose ground at a fast pace. In tonight’s Asian session, the currency market moved mixed in preparation for the last trading day of the week.
The Euro (Eur/Usd) strengthened for a fourth consecutive day yesterday. The pair struggled overnight to move lower, but was helped by the positive U.S. equity markets, which rocketed during the U.S. session, as did most majors. Additionally, the pair tested the 50-day moving average yesterday, but failed to break anywhere higher.
The Pound (Gbp/Usd) tried initially to head lower, but TheLFB S1 (1.3700) held the pair during the overnight session. Soon after, the pound started strengthening, and rose 280 pips during U.S. session. At the end of the day, the pound gained 90 pips and broke above the high of the last two days of trading.
The Aussie (Aud/Usd) formed a doji-star, as the pair traded trapped between two important swing points in the last day of trading. On the upside, the resistance area is formed by the 50 and the 100-day moving averages, while on the downside, the 20-day moving average acts as a support area. In tonight’s Asian session, the aussie rose 40 pips and re-tested the resistance area.
The Cad (Usd/Cad) traded in a 100-range during the overnight session, but the pair managed to break lower during the U.S. session. As such, the cad starts the Asian session trading near the support area of the 300-pip range it developed in the last period.
The Swissy (Usd/Chf) probably posted the biggest intra-day candle on record yesterday. The pair rose 320 pips in less than 15 minutes, after the SNB officially announced it would start buying foreign currencies to depreciate the Swiss franc. Other than that, yesterday the swissy touched the highest value in the last four months.
The Yen (Usd/Yen) traded in some very large swings during the last day of trading. The yen plunged initially 180 pips during the Asian session and during the early hours of the European session, but then started to recover and gained 280 pips from the low of the day. During the U.S. session, the yen again shed some pips and finished the day forming a large doji-star.