Overall, the currency market extended the dollar gains during the overnight session. The market moved in similar fashion to Monday’s trading session, when the majors declined in the Asian session but found a temporary bottom during the European trading hours with the exception of the euro and swissy which traded side-ways. The dollar index moved in-line with the S&P futures.
The Euro (Eur/Usd) traded side-ways since the Tuesday trading session started, despite the moves posted by the other major pairs. During the previous day of trading, the euro declined significantly, losing more than 200 pips. For now, the euro trades below all the important moving averages.
The Pound (Gbp/Usd) dropped 100 pips during the Asian trading hours, down to TheLFB S1 1.4525. However, it looks like the pair has found a temporary bottom, near 1.4500, at the London open, as did the rest of the majors. Currently, the pound remains trapped between the 20 and the 100-day simple moving averages, similar to the previous day of trading.
The Aussie (Aud/Usd) moved lower during the Asian session, but again, managed to find a bottom after the European session started. The pair fell approximately 80 pips during the overnight session, extending the declines seen on Monday. The next important support for the aussie is the 0.6950 area. If the pair breaks lower, below 0.6950, it will reach the lowest valuation in the last few weeks.
The Cad (Usd/Cad) saw a 25-pip range during the Asian trading hours, but the pair gathered additional momentum as the market was heading towards the London open. As such, the cad managed to break above the high reached on Monday, but failed to continue the move above TheLFB R1 (1.2245) and at the same time above the 20-day simple moving average.
The Swissy (Usd/Chf) moved side-ways during the Asian and the European trading sessions, similar to how the euro behaved overnight. The pair traded in a 25-pip range, slightly above the 50-day simple moving average. This happens, after the swissy traded in volatile fashion in the last few days of trading.
The Swiss Consumption Indicator rose in March for the first time in the last four months. The index gained 0.10 points, up to 0.99. “Despite this, the prospects are becoming increasingly gloomy. Due to the economic downturn, unemployment is set to rise in the coming months, which will have a negative effect on consumer spending,” TheLFB-Forex.com Trade Team said.
The Yen (Usd/Yen) fell to TheLFB S3 (95.70) area during the overnight session, as the market remained in risk-aversion mode. On Monday, the pair followed a similar pattern, but eventually managed to stabilize during the European session. Currently, the yen trades at one-month low.
Retail sales in Japan have declined again, for a seventh straight month, in March. Sales declined 3.9 percent on the month from one year ago. This was after dropping 5.7 percent the previous month. The slump comes amid a deepening recession which has diminished demand for exports from the country. Corporations have had to cut workers, as well as wages and hours, which has squeezed households of disposable income.