Overall, the Asian session moved on a strong momentum again, helped by the GDP release coming from Australia. Before it, the majors were barely moving, but the poor read to some extent, changes the fundamentals of the region and triggered some strong selling orders throughout the market. Ahead, the calendar holds some important releases for the next two sessions - the European and U.S.
The Euro (Eur/Usd) fell tonight to the lowest point since November, it has fallen 80 pips in the Asian session. The euro selling came during the Australian GDP release, but the euro was already heading lower for a relatively long period, and the ECB is looking behind the curve.
The Pound (Gbp/Usd) formed a doji-star at the end of the last trading day, as it was unable to trend anywhere. During the intra-day session, the pair struggled to stay above the 1.40 support level, and has succeeded despite the numerous breakout attempts. In the Asian session, the pound re-tested the same resistance area.
The consumer confidence for the U.K. in February came in at 43 despite analysts’ forecasts for a much lower 38 reading. The index rose by two points, this is the first rise seen since October 2008. Consumers have shown that they are becoming more optimistic about future economic conditions. A recent survey shows more consumers are thinking that now is a good time to make large purchases. House prices have fallen and new car discounts are beginning to take effect. Either way, the increased optimism about the future of the U.K. economy is encouraging.
The Aussie (Aud/Usd) was again the star of the Asian session tonight, after a report showed that the Australian GDP contracted 0.5%, more than expected. This, in turn, triggered some strong selling orders in the market. During the release, the pair fell 80 pips instantly, breaking under the low made on Tuesday with a lot of ease.
In trend terms, the GDP decreased 0.1 percent and non-farm GDP also decreased by 0.3 percent. However, in seasonally adjusted terms GDP dropped by 0.5 percent, which is well below expectations of a 0.2 percent increase. In seasonally adjusted terms, the largest negative contribution was from inventories, which were offset by the positive contribution from imports and private business investment. The sectors that also contributed to the decline were manufacturing (-0.5%), property and business services (-0.3%), and wholesale trade (-0.2%).
The Cad (Usd/Cad) traded very volatile in the last day of trading, as the market expected the BoC’s interest rate decision. Even though the pair struggled almost all day long to break higher, it never succeeded in making any new highs. On the short term, the next important resistance remains in the 1.3000 area.
The Swissy (Usd/Chf) managed to break above the high of the last two days of trading tonight, in the Asian session, during the Australian GDP release. However, it looks like it topped just a few pips higher, near TheLFB R1 (1.1810). For the last few weeks, the swissy traded in a wide range, making the daily chart look like a mess.
The Yen (Usd/Yen) traded near the 98.50 resistance area during the Asian session, where the pair topped in the last five days of trading. Yesterday, the yen rose 110 pips, having much of the gains seen in the overnight session. If the pair breaks anywhere higher, it will reach the highest value since early November.