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Overall, the dollar index gained 0.60% on Monday, as the currency market was driven by risk-aversion. The dollar posted the biggest advances against two commodity driven currencies, cad and aussie, as the price of crude oil and metals tumbled more than 4% today. However, the dollar posted relatively small declines against the euro and the pound, while the greenback lost only 30-pips compared to the yen so far. To some extent, this shows that the downside action was driven by the equity markets, while currency investors appeared hesitant to buy the safety of the greenback as the huge U.S. deficit and the ultra-low interest rates (pledging to remain low for a long period) adds pressure on the currency. 

The Euro (Eur/Usd) declined as much as 100 pips during the intra-day session, but the euro retraced some of these declines throughout the U.S. trading hours. Moreover, during today’s session, the euro appeared somehow reluctant to create lower lows or to break any important price points, something that may suggest that the market does not really want to sell this pair. During the European session, a released showed that the German Ifo Business Climate increased for a third consecutive month in June. 

The Pound (Gbp/Usd) lost 160 pips on Monday, paring every pip gained throughout Friday’s trading session. During the European session, the pound showed some signs of strength since it almost completely retraced the declines seen earlier in the day. However, soon after, the pound resumed its downward trend, in-line with the other major pairs. 

The Aussie (Aud/Usd) spent most of Monday’s session heading lower, even though the pair hesitated a little during the late Asian session. Since the open of the Sunday session, the aussie lost 160 pips, or 2%, the most in the last three weeks of trading. For the aussie, the next major support point is around the 0.7850 area.

The Cad (Usd/Cad) traded in tandem with the aussie today, moving only higher. The pair gained as much as 220 pips during Monday’s session, but retraced some of it throughout the late U.S. session. Moreover, the pair managed to break above the 1.1470 area, an area that has acted as a very important swing point in the past. 

The Swissy (Usd/Chf) bounced off the 20-day moving average during the Asian session, and since then the pair has been trading only in the green. Despite this, the pair failed to break above the 1.0900 area, which has acted as a strong resistance area for the last three days of trading. 

The Yen (Usd/Yen) spent the majority of the Monday session trading in a 40-pip range, even though the rest of the major pairs saw some rather strong trends developing. During the intra-day session, the pair spent most of the session trying to break below TheLFB R1 (95.75), where it failed at this support area. 

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