INTERNATIONAL CURRENCY BUZZ :
- Forex -Dollar extends gains as market sentiment brightens
- Forex -Aussie edges higher, kiwi tumbles over 1% in late trade
- Forex- Dollar extends rally as risk sentiment improves
EUR/USD remains under pressure on Thursday, following sharp losses in the Wednesday session. The euro is trading at 1.1270 in the European session. On the release front, Eurozone Final CPI posted a flat reading of 0.0%, while Final Core CPI came in at 1.0%. Both indicators were within expectations. The US will also release CPI reports later in the day, as well as Unemployment Claims. On Friday, we’ll get a look at the UoM Consumer Sentiment Index, a key gauge of con- sumer confidence. A major headache for Mario Draghi and his colleagues at the ECB has been the persistent lack of inflation in the Eurozone economy, as weak growth in the bloc as raised the nightmarish scenario of deflation
GBP/USD pair made a failed attempt to take out 1.4354 (61.8% of 1.4669-1.3835) earlier this week before dropped to a low of 1.4090 levels in Europe today. The spot is now trading around 1.4145 levels ahead of the BOE rate decision. Latest Reuters poll released yesterday showed majority of economists see a BOE rate cut if Britons vote in favor of Brexit. Markets have also pushed up H1 2016 rate hike bets, again due to fear of Brexit. Hence, trading community is likely to scan the policy statement and minutes for comments on Brexit and bank’s response if UK votes to leave EU on June 23. Apart from this, comments on inflation and labor market could influence demand for Sterling. The latest attempt at recovering losses ran out of steam at hourly 200-MA level of 1.4176, making it a strong resistance, which needs to be breached if prices are to move higher to 1.42-1.4221 (hourly 50-MA). A violation there could signal intraday bearish invalidation, trapping bears on the wrong side and thus helping the pair extend gains to 1.4252 (50% of 1.4669-1.3835).
- BUY GBP/USD ABOVE 1.4160 TARGET 1.4180 1.4210 SL 1.4130
- SELL GBP/USD BELOW 1.4115 TARGET 1.4095 1.4065 SL 1.4145