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Dean's Daily FX Update – 01 June 2017
In the Zone
- EURUSD
- USDCHF
- USDJPY
- USDZAR
Noteworthy News
- Although the lead on the Conservative Party in the UK Election is narrowing, the forecast is still showing that PM May will earn enough seats for a parliamentary majority which will of course indicate a stronger position in Brexit negotiations.
Recap
The greenback was a mixed bag yesterday, it staged a mini rally against the commodity currencies yet battled against the safe haven basket. Oddly enough there was no particular reason for a weaker dollar, the economic data only had an impact because it was reported incorrectly and talk out from the Fed was not out of the ordinary. It was the end of the month and perhaps we saw some month end flows affecting the market.
The EURUSD benefitted nicely from the weaker dollar as it finally moved away from the converging 100 and 200 hour MA at 1.1185 and pushed higher, this technical break drove the EUR to the recent high at 1.1250 before we found some minor resistance. The bulls will need to see the pair trade through this level before it is confident to target the US election highs at 1.1300. The buyers will start rethinking their strategy if we are to trade back to 1.1200 this morning as then the market will start painting a new trend for this pair.
The cable is a tricky pair to trade at the moment as any potential move is always at risk of reversing on polls. The pair looked as though we were going to move substantially lower yesterday morning on a poll that the Conservative Party lead was narrowing. The late afternoon rally meant that this was reversed and the pair actually traded higher and only found resistance at the 200 hour MA level of 1.2915. This morning traders will focus on 1.2875, if it can break this support then the lows of yesterday at 1.2825 will be eyed. This can all change on the whim when another poll gets released and that is why I am going to sit this pair out until after the UK General Election next week.
Oil prices are lower and the Canadian GDP came in a lot lower than expectation yesterday, which meant a late push in the New York session. The pair moved beyond the 200 hour MA at 1.3475, this had confluence with a downward trend line, but the USDCAD found some sharp resistance at 1.3520 and eventually settled at 1.3495. Yesterday’s resistance at 1.3475 becomes support this morning and if price dips lower then I would expect the buyers to start building bids.
After a volatile month, filled with political scandal the Dollar Index is starting to show signs that it has bottomed out, we have NFP tomorrow and could we be seeing the first clues that the dollar is ready to launch a sustained rally against all the major pairs?
Daily Ranges 01/06/2017
Majors
EURUSD
Resistance 1.1250 – 1.1275
Support 1.1190 – 1.1170
GBPUSD
Resistance 1.2880 – 1.2900
Support 1.2820 – 1.2800
AUDUSD
Resistance 0.7440 – 0.7460
Support 0.7380 – 0.7350
NZDUSD
Resistance 0.7090 – 0.7110
Support 0.7050 – 0.7040
USDCAD
Resistance 1.3510 – 1.3530
Support 1.3460 – 1.3440
USDJPY
Resistance 111.00 – 111.20
Support 110.50 – 110.30
USDCHF
Resistance 0.9730 – 0.9750
Support 0.9670 – 0.9650
Rand
USDZAR
Resistance 13.1700 – 13.2150
Support 13.0470 – 13.0050
EURZAR
Resistance 14.7750 – 14.8000
Support 14.6040 – 14.5500
GBPZAR
Resistance 16.9380 – 16.9860
Support 16.2060 – 16.1560
Minors
AUDCAD
Resistance 1.0040 – 1.0050
Support 0.9970 – 0.9950
AUDJPY
Resistance 82.80 – 83.00
Support 82.30 – 82.10
EURCHF
Resistance 1.0910 – 1.0920
Support 1.0850 – 1.0830
EURGBP
Resistance 0.8720 – 0.8750
Support 0.8680 – 0.8660
EURJPY
Resistance 124.80 – 125.00
Support 123.65 – 123.45
GBPJPY
Resistance 142.70 – 142.90
Support 141.90 – 141.80
GBPCAD
Resistance 1.7380 – 1.7400
Support 1.7250 – 1.7230
GBPCHF
Resistance 1.2530 – 1.2550
Support 1.2460 – 1.2440
Indices
DE30
Resistance 12630 – 12650
Support 12550 – 12520
UK100
Resistance
Support
US500
Resistance 2418 – 2430
Support 2390 – 2380
US30
Resistance 21080 – 21000
Support 20900 – 20870
SA40
Resistance 47800 – 48100
Support 46700 – 46400
Commodities
BRENT
Resistance 51.70 – 51.90
Support 50.80 – 50.50
XAUUSD
Resistance 1260.00 – 1270.00
Support 1240.00 – 1220.00
XAGUSD
Resistance 17.40 – 17.60
Support 17.00 – 16.80
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