The U.S. economy today is scheduled to release its consumer confidence for May with expectations showing will inch higher to 58.5 from 57.9, as consumers are lookingat the outlook of the nation. The upbeat projections regarding confidence are encouraging investors to turn to the dollar, and this is supporting the rally of the dollar against major currencies. The Dollar Index, which gauges strength of the dollar against six major currencies, is currently inclining trading at 87.32 while recording a high of 87.44 and a low of 86.36.
As the International Monetary Fund (IMF) obligated the government of Spain to fix its banks in order to avoid the debt crisis from spreading, the euro resumed its depreciation versus the dollar on anticipations that still the financial crisis resumes in Europe.
The euro is already pressured from the debt crisis in the euro zone that is weighing on growth prospects which is scaring investors from the euro as they see it declining further in the long run. The euro dollar pair is currently trading at 1.2184 between the support of 1.2125 and the resistance of 1.2230 while recording a high of 1.2371 and a low of 1.2175. Over the one-hour basis, the technical charts are showing us that the pair is being traded in an oversold area.
Turning to the pound, we see that despite the UK releasing its first quarter GDP preliminary reading showing that the reading was revised upwards to 0.3% from 0.2%, yet since it was projected in markets, it did not support the declining pound, as currently the negative sentiment is much heavier than any economic data. The pound dollar pair is currently trading at 1.4280 above the support of 1.4230 and below the resistance of 1.4340. The technical charts here also indicate over the four-hour basis that the pair is being traded in an oversold area while recording a high of 1.4422 and a low of 1.4256.
The yen is seen inclining in the markets against the dollar, as currently investors are more interested in safe-haven asssets versus the higher-yielding ones, which supports the rise of the yen. The pair is currently trading at 89.48 while so far posting a high of 90.30 and a low of 89.39, as there is a support at 89.00 and a resistance at 90.00.