FX News - June 27 2014: Majors Take Advantage of Weak USD

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The AUD/USD pair returned to the 0.9400 level today mainly due to the weakened greenback. The United States released a number of reports yesterday that dragged down the value of the USD, including Personal Spending in May, which came up only at 0.2 per cent (0.4 per cent was expected), Initial Jobless Claims, which came out at 312K (only 310K expected), and Continuing Jobless Claims at 2.571 million (2.570 million expected). St Louis Fed President James Bullard also gave hawkish comments yesterday, which suggested that the Fed might raise interest rates sooner than expected, but this did not help lift the USD.

The AUD/USD pair thus broke past the 0.9400 level today after a weak performance during the middle of the week. It opened the Asian session at 0.9406, before picking up and peaking at 0.9441 prior to the opening of the European session. The mood has been more subdued after that, however, and the pair is currently trading at 0.9419, with initial resistance seen at 0.9429, followed by 0.9453. Meanwhile, initial support is at 0.9404, followed by 0.9381.

The USD/JPY pair also benefited from the weak greenback, as it slid further today, continuing a trend that began on Wednesday. It opened today’s Asian session at 101.64, but it has mostly hovered within a very tight range between 101.35 and 101.45. It is currently trading at 101.39, with initial resistance seen at 101.81, followed by 102.06. Meanwhile, initial support is at 101.41, followed by 101.16.

As for the GBP/USD, the pair briefly hit today’s high at 1.7050, but mostly ranged within the 1.7020-1.7035 area as the day progressed. The United Kingdom released earlier a series of mixed reports, including the country’s GDP data, which met expectations at 0.8 per cent on a MoM basis, but went out slightly lower than expected at 3.0 per cent (3.1 per cent expected), on a YoY. Meanwhile, Total Business Investment in Q1 came out better than expected at 10.6 per cent on a YoY basis (8.7 per cent expected), and 5.0 per cent on a QoQ basis (2.7 per cent expected).

The pair is currently trading at 1.7027, with initial resistance seen at 1.7067, followed by 1.7112. Meanwhile, initial support is at 1.6999, followed by 1.6957.

By FX Strategy Team, Published on 27th of June 2014
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