Watch for downside potential in cross-yen pairs facing resistance
07.06.2023
- Canada: BOC Policy Rate and Statement Release
- U.S. Weekly Crude Oil Inventories
In yesterday’s U.S. currency trading, the U.S. dollar rose against the euro. The EUR/USD pair fell back from 1.0732 to 1.0667, erasing the gains from the day before yesterday. On the daily chart, the EUR/USD is trading just below the 200-day EMA. If it breaks below this support level, it could extend its decline toward the next support level around 1.0559, so traders should be cautious of further downside potential during European trading hours.
Among European currencies, the pound saw mixed trading against the yen. The GBP/JPY pair traded in a range between 172.683 and 173.7776, searching for direction. Although it rose to the 20-period moving average (MA) on the hourly chart, it failed to hold that level for long and fell back. During today’s Asian session, the pair has been trading below the 20-period MA and moving lower, so traders should watch for a continued decline during the U.S. session.
Today’s economic indicators include: Switzerland’s unemployment rate at 14:45, Germany’s industrial production and the UK’s Halifax house price index at 15:00, France’s trade balance and current account balance at 15:45, the U.S. MBA mortgage applications index at 20:00, Canada’s trade balance and Q1 labor productivity index at 21:30, and the U.S. trade balance atat 11:00 PM: Canada’s BOC policy rate and statement; at 11:30 PM: U.S. weekly crude oil inventories; at 4:00 AM: U.S. consumer credit balances; and at 7:45 AM the following day: New Zealand’s Q1 manufacturing sales. We should watch for downside potential in cross-yen pairs, which are facing resistance on the upside.
Author: Keisuke Sakurai
