Overall, the market traded mixed during the Asian session, regaining a breath of air after a very strong trading day experienced on Monday. It seems that U.S. futures led the dollar index higher, as it has been the case over the last period of trading. Ahead, the European calendar is packed with important releases, something that will probably influence the currency market.
The Euro (Eur/Usd) declined another 120 pips on Monday, practically being the fifth consecutive day the euro was sold off. Most of the declines came during the overnight session, when the U.S. futures influenced the currency market. During the U.S. and the Asian sessions, the euro traded in a 40-pip range, above the 1.2900 support level.
The Pound (Gbp/Usd) declined very sharply during the overnight session, practically being the worst performer of the day. However, the pair traded flat during the U.S. session, in a very tight range. In the Asian session, the pound extended the declines, falling another 60 pips, below the 100-day simple moving average. In addition, the pound broke on Monday below a very important trend-line that connected the 03.11 and 03.30 lows.
The Aussie (Aud/Usd) recorded some huge declines over the last few trading sessions, as the pair was dragged lower by the commodity market. The aussie declined 240 pips on Monday, the most since November 2008. Moreover, the aussie broke under a one-month old trend-line, which practically held the pair at that level during the recent uptrend.
The Cad (Usd/Cad) picked up 270 pips during the previous day of trading, on Monday, paring the declines the pair made over the last three weeks. The cad was bought at the start of the Sunday session, as crude oil posted significant declines. During tonight’s Asian session, the cad broke briefly above the 100-day moving average, but then retraced shortly after.
The Swissy (Usd/Chf) gained 20 pips on Monday, in a period when the rest of the majors recorded huge declines against the dollar. The swissy traded between well-defined support and resistance levels during the previous day of trading, on Monday. On the upside, the pair struggled successively to break above 1.1715 and the 1.1740 levels, while on the downside, the swissy bounced off the 1.1675 support area.
The Yen (Usd/Yen) declined on Monday, the most over the last few weeks, as the currency market was driven by risk-aversion. The yen fell 115 pips, breaking below the 200-day simple moving average on Monday. Tonight, during the Asian trading hours, the pair re-tested Monday’s low, but now is trading above the opening price.