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10 April Forex Daily Review

Sergiy Zlyvko
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On Thursday, the U.S. dollar index is updated session minimum. Even the report on applications for unemployment benefits did not help the U.S. dollar. According to recent data, the number of applications for unemployment benefits in the U.S. last week fell by 26 thousand to 300 thousand (forecast was 325 thousand, the previous value was revised from 326 thousand to 332 thousand).

EURUSD in the U.S. session rose to 1.3900. Bulls ignored all statements made by the ECB about the possibility of non-standard measures adoption to fight deflation. GBPUSD after the Bank of England’s statement dropped to 1.6755 and is currently consolidating at around 1.6770 mark.

Yesterday we said that if the dollar index will update the minimum, then today we will consider major currencies decline against the dollar. The dollar index for twelve hours is traded in a narrow range. This indicates that the bears are preparing to update the minimum. After falling to 79.30, we are waiting for the rebound of DXY then breakout of the trend line at 79.50 with a further increase to 79.55. For EURUSD testing 1.3905 level and fall to 1.3860 are considered. Since GBPUSD consolidated yesterday, against the background of EURGBP cross correction, it may rise to 1.6800 mark. And just after the Stochastic on hourly timeframe climb to sales area, it will be possible to expect fixing before the weekend.

For four days EURUSD rose from 1.3670 to 1.3900 level (236 points). We believe that weekly growth is ended. Bulls still can update the maximum as Stochastic is unsuccessful. We inclined to think that fixing will start on the European session. Unlikely bulls want to leave long positions on the weekend days. On Saturday at 16.00 GMT ECB President Mario Draghi has a speech. If he will blurt something about non-standard measures to fight inflation, do you imagine what will happen to the market on the opening on Monday?

British pound after the Bank of England’s statement declined to the level of 1.6755. Rebound was little and now the pair is trading at 1.6770 level. Local Stochastic Oscillator is in buying area, so on the main scenario before further decline, we are considering a growth of GBPUSD to 1.6800.

On Thursday, AUDUSD exchange rate closed at around 0.9400 mark in the morning and on weak data from China it fell to 0.9360. No the rate is 0.9425. Today we are waiting a correction from the dollar, only to be held 3-4 hours as the market is ready to buy the dollar. As for the Aussie, the Australian currency in the first half of the day soon be rolled back and decline again. It is necessary to monitor the cross pairs GBPAUD, AUDJPY, EURAUD and AUDCHF. If traders will buy AUD, AUDUSD will be sharply strengthened. If traders take a wait and see position, the pair remains below 0.9350. level.

USDCHF rate updated the minimum at 0.8750. Night narrow range indicates that there will be an attack on the dollar and then fixing. We expect trend line breakdown on the U.S. session.

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