All eyes are on whether currency strength will shift in response to remarks by key figures
05.06.2023
- Remarks by ECB President Lagarde
- European Services PMI
In the U.S. currency market last weekend, the U.S. dollar rose against the euro following the release of the U.S. May employment report on Friday, the 2nd, which showed that average hourly earnings had declined from 4.4% to 4.3% year-over-year.The EUR/USD pair fell by approximately 70 pips from 1.0778 to 1.0704. Although it had broken above the 20-period moving average (MA) on the 4-hour chart, it reversed lower after encountering resistance at the 75-period MA. On the higher timeframe daily chart, the EUR/USD pair is being capped by the 10-period MA, so we need to be cautious about whether it will extend its decline and break below the recent low.
Among European currencies, the pound fell against the U.S. dollar ahead of today’s release of the services PMI. The GBP/USD pair dropped by about 100 pips from 1.2544 to 1.2441.This pullback occurred immediately after the pair broke above the daily 20-day moving average (MA). However, on the higher timeframe (weekly chart), GBP/USD is finding support at the 20-day MA. Therefore, if the decline continues, we will be watching closely to see if the pair breaks below the support level at 1.2309.
Today’s schedule includes Germany’s trade balance at 3:00 PM, Switzerland’s CPI at 3:30 PM, Turkey’s CPI at 4:00 PM, France’s Services PMI at 4:50 PM, Germany’s Services PMI at 4:55 PM, the Eurozone Services PMI at 5:00 PM, the UK Services PMI at 5:30 PM, and the EurozoneProducer Price Index at 18:00, U.S. PMI at 22:45, remarks by ECB President Lagarde at 22:00, U.S. ISM Non-Manufacturing Index at 23:00, and U.S. Durable Goods Orders are scheduled. We will carefully monitor whether currency strength shifts in response to these key figures’ remarks.
Author: Keisuke Sakurai
