Keep an eye on the U.S. 2- and 5-year Treasury auctions

Keep an eye on the U.S. 2- and 5-year Treasury auctions

27.06.2022

Last weekend, the U.S. dollar traded in a directionless range but weakened against the euro, with the EUR/USD pair rising slightly from 1.0511 to 1.0572.The euro was supported by the German Ifo Business Climate Index for June, released on the 24th, which came in at 92.3, exceeding the market forecast of 92.0. Technically, with the 200-period simple moving average (SMA) on the 4-hour chart acting as resistance above, attention will focus on whether the EUR/USD pair can break above the 200-SMA line at 1.0585.

Among European currencies, the pound weakened against the Australian dollar, with the GBP/AUD pair falling approximately 160 pips from 1.7814 to 1.7652. Following a sharp decline last weekend, the GBP/AUD pair has now fallen below the 20-period moving average on the 4-hour chart. Given that the Australian dollar is the weakest currency in today’s Asian session, we need to carefully assess whether the rebound momentum will continue.

Today, at 17:30 CET, Hong Kong’s trade balance will be released; at 21:30 EST, U.S. durable goods orders; at 23:00 EST, pending home sales; at 23:30 EST, the Dallas Fed Manufacturing Index; at 24:30 EST, the U.S. 2-year Treasury auction; at 26:00 EST, the U.S. 5-year Treasury auction;and a speech by ECB President Lagarde at 2:30 a.m. We will be closely monitoring the U.S. short-term Treasury auctions during U.S. trading hours.