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Overall, the currency market lacked a solid direction during the Asian session, as the major pairs traded most of the time within a side-ways channel they developed in the late U.S. session. Ahead, the market might become very volatile as the release calendar is packed with important economic releases both in the European and in the U.S. sessions.
The Euro (Eur/Usd) had no clear direction of trading throughout the Asian session, as the pair extended the range seen in the late U.S. trading hours. For some time now, the euro has been unable to sustain a solid trend over the course of a few days or at least sessions. For this to happen, the euro would have to first clear the 1.3830 or the 1.4130 areas.
The Pound (Gbp/Usd) tried to break below the 1.6425 area during the Asian session, but so far, the pair has failed to do so. Around the same area, the pair bottomed on Monday and Tuesday. The sentiment surrounding the pound may have turned negative, after a report showed on Tuesday that the U.K. economy contracted much more than expected.
The Aussie (Aud/Usd) traded side-ways during the new Wednesday session, extending the 25-pip range it developed throughout the late U.S. trading hours. On Tuesday, the aussie formed a bearish pin-bar formation, which usually is interpreted as a reversal pattern.
During the Asian session, a release showed that retails sales rose twice as much as expected, while the number of building approvals declined by a whopping 12.5% in May, much worse than expected.
The Cad (Usd/Cad) made a weak attempt to move higher during the Asian session, but failed to do so as the pair moved almost without any momentum. Moreover, the pair reversed after it touched the 38.2% retracement area of the downtrend that started in early March.
The Swissy (Usd/Chf) followed the euro very closely during the Asian session. As such, the pair fell down to the neutral pivot point (1.0840) during the early Asian session, but bounced 40 pips higher from there. On the daily chart, the swissy moved barely above the 20-day moving average.
The Yen (Usd/Yen) surged 60-pips during the Asian session, up to TheLFB R1 (96.75). Most of the gains came shortly after the Tankan release, which showed that the manufacturing side of the Japanese economy is still in a deep contraction phase, something that puts downside pressure on the Japanese yen. For now, the yen is trading near the resistance area formed by the 20 and by the 50-day moving averages.
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