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Market Insight Commentary – Forex
Today's News Headlines
- The BOC was cautious yesterday and as a result the market did not move that much, the interest rate environment for next month is still a 50-50 decision which does not help the USDCAD.
Market Insight Commentary – Indices
Market Recap
The “circus” continued yesterday with the US back tracking on threats on China to implement measure to protect their IP. There was only a tiny reprieve but at the end of the day it seems as though the dollar really is the king, the pressure on emerging markets is supporting the dollar. The issue with the dollar being so strong is that it is not going to make the trade situation any better – the debt markets are not liking what it is seeing and so volatility is reigning supreme.
The EURUSD started the day by holding support at the 100 hour MA, it was not long before this and a slew of other technical support levels were broken and the pair was trading from 1.1620 to 1.1530. The key support level to watch today will be 1.1500, it is definitely a floor and if it gets broken then there could be fireworks lower down.
The GBPUSD ended the day nears its yearly lows at 1.3100, it could not manage the move above 1.3230 which was a major moving average level. Sellers took this as an invitation to drive the pair lower, there will be likely be stops at 1.3075 and if that breaks it could go much lower. I suspect that there could be a lot of dip buyers in the market today.
The USDCAD continues to be the pair that I will be watching, there has been a tight 50 pip range for the last 2 weeks and this range held – despite the BOC press conference yesterday. The 100 hour MA of 1.3300 and the 200 hour MA at 1.3277 must be targets leading into today, the pair has not traded lower for some time and so if it breaks lower then it could get some momentum behind it.
Important Economic Data Due Today
14:30 USD GDP
Consensus: 2.2%
Effect: Higher than expected is good for the USD
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