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Overall, the dollar posted important declines on Wednesday, as crude oil advanced for the first time in 10 days and the S&P futures surged almost 2.5%. It is important to note that, for now most majors pairs are trading near crucial price points, which might have led the fx market to test the highs reached at the beginning of June. If the global market will remain in a risk-tolerance mode, it is likely that this would eventually happen over the next few days.
The Euro (Eur/Usd) led the major currencies higher compared to the dollar on Wednesday. The euro moved higher most of the time during the European and the U.S. trading hours, something that helped the pair gain as much as 160 pips. For now, the euro is trying to break above TheLFB R3 (1.4125) and at the same time, above a resistance trend-line that holds the pair since early June.
The Pound (Gbp/Usd) had weaker momentum than the other majors currencies during the second part of the day, something that limited the pound’s upside movement and acted as a drag most of the time. During the European session, the fx market had to digest the U.K. labor market reports, which showed that the unemployment rate jumped to 7.6%. At the same time, the claimant count increased by 23.8K in June, to reach the highest numbers since 1997.
The Aussie (Aud/Usd) is currently struggling to take out TheLFB R2 (0.8035), after the pair surged 100 pips during the European and the U.S. sessions. In order to move higher, the next important resistance area that the aussie would have to break is the 0.8050-0.8100 area, which has held the pair for almost a month.
The Cad (Usd/Cad) declined almost 500 pips during the last three days of trading, shedding every pip the pair has gained over the prior three weeks of trading. More importantly, the cad is once again able to sustain a trend, after a period in which the pair had a very small ATR and formed only uncertainty in the patterns on the daily chart.
The Swissy (Usd/Chf) lost 150 pips so far, as the dollar showed signs of weakness against every other major currency. The swissy started to move lower during the London open, and continued the downside move throughout the U.S. trading hours. During the European session, a report showed that retail sales dropped 1.4% in May, much more than expected.
The Yen (Usd/Yen) traded flat throughout the overnight session, but around the U.S. open, the yen bounced from a trend-line that held the pair over the last two days of trading. This has caused the pair to jump almost 100 pips higher, and more importantly it helped the pair to break above the 93.50 resistance.
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