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Overall, the currency market moved higher compared to the dollar during the U.S. session, reversing the declines seen earlier in the day and even gaining. This, in turn, helped a number of pairs develop bullish pin-bar patterns on the daily charts, which are usually interpreted as a reversal sign. Ahead, the bullish sentiment of the fx market may continue during the Asian session, as long as the Nikkei and the S&P futures stay above the break-even line, which could help the majors advance above the highs/lows set during the U.S. trading hours.
The Euro (Eur/Usd) spent most of the day trading between the 20 and the 50-day moving averages. However, helped by the strong U.S. session, the euro has managed to advance a few pips above the 20-day moving average. The next important resistance area that the euro has to take out now is the 1.4030 area.
The Pound (Gbp/Usd) tested the 50-day moving average, and at the same time TheLFB S2 (1.6045) during the European session, but the pair bounced higher from this support area. From the low set during the European session to the current high reached during the U.S. trading hours, the pound gained 200-pips.
The Aussie (Aud/Usd) reached the lowest value since late May during the European session, as the pair broke shortly below TheLFB S1 (0.7730). Soon after, the aussie reversed once with the entire market, which has helped the pair to retrace almost all of the ground lost earlier. On the daily chart, the aussie seems to be forming a doji-star.
The Cad (Usd/Cad) declined at a strong pace during the U.S. session, even though the pair looked resilient to move during the first part of the day. For now, the cad is sitting right on top of the 20-day moving average, after it lost 90 pips throughout the day.
The Swissy (Usd/Chf) moved up and down and around the 20-day moving average on Monday, unable to develop a solid trend. Moreover, this has been the case over the last few weeks, since the swissy has been trading in a 160-pip range.
The Yen (Usd/Yen) re-tested the 91.80 area, where the pair bottomed over the last few days of trading, as the S&P futures headed lower during the overnight session. However, the move was rejected and the yen started to head higher, retracing every pip it lost earlier and even adding a few more. For now, the yen appears to be forming the second bullish pin-bar in a row on the daily chart.
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