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Overall, the currency market retraced some of the declines, seen during the previous day of trading, throughout the European session, after the market traded directionless during the Asian session. Currently, the currency market is awaiting the interest rate decisions from the three major central banks, ECB, BoE and the BoC. Additionally, investors will be paying close attention to Mr. Trichet’s news conference. 

The Euro (Eur/Usd) retraced half of the declines seen on Wednesday during the overnight session, ahead of the ECB’s interest rate decision. For now, the euro appears to be forming a head and shoulders pattern, if it fails to break above the 1.4240 level, while the neckline is in the 1.4120 area. 

The Pound (Gbp/Usd) is currently trading in an upside channel, but the pound briefly broke below it during the Asian session, when the pair fell 80 pips. Throughout the European session, the pair recovered every lost pip and gained an additional 120 pips. Additionally, the pound received a strong boost during the European session, when a release showed that the U.K. house price index rose unexpectedly in May. Later this morning, the BoE is expected to leave interest rates unchanged at 0.50%. 

The Aussie (Aud/Usd) gained approximately 90 pips overnight as commodities, Australian’s biggest export products, recovered some of the losses seen during the previous day of trading, on Wednesday. In the last three months of trading, the aussie has seen a very strong uptrend, gaining more than 25%. 

The Cad (Usd/Cad) had no clear direction during the early part of the overnight session. However, during the early European session, the cad re-tested the high reached on Wednesday, but the move was rejected and since then the cad has moved lower. Throughout the European session, the cad lost approximately 100 pips. At 09:00 EDT, the BoC is expected to leave interest rates unchanged at 0.25%.

The Swissy (Usd/Chf) fell to the neutral pivot point (1.0685) during the Asian session, and was unable to move anywhere from that point until the London open. Shortly after the European session opened, the swissy started to move lower, in-line with the moves made by the euro and by the S&P futures. 

The Yen (Usd/Yen) moved higher during the overnight session, forming a pattern that looks like an ascending triangle. The next resistance area for the yen is in the 96.40 area, around TheLFB R1, where the pair peaked in the previous day of trading.  
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