Concerns over further downside potential for the pound against the U.S. dollar
13.05.2024
- Swiss Consumer Confidence Index
- Japan · Money Supply
Last weekend, the U.S. dollar rose against the euro as the Dollar Index edged up to 105.3.The EUR/USD pair fell from 1.0789 to 1.0760. On the hourly chart, the price moved from above the 20-period moving average (MA) to below it. Although the pair remained above the 20-period MA on the 4-hour chart, it failed to break through the resistance level and ended up pulling back. On the daily chart, the price fell as the 200-period simple moving average (SMA) acted as resistance, so we should watch for a potential decline during European trading hours.
European currencies came under pressure as the British pound fell against the U.S. dollar following the release of UK industrial production data for March on the 10th, which showed a year-on-year decline of 0.5%, down from 1.4% the previous month. The GBP/USD pair fell from 1.2541 to 1.2502, briefly dipping below the 200-period simple moving average (SMA) on the hourly chart.On the 4-hour chart, the 200-period SMA is acting as resistance, causing the price to stall, and similar price action is observed on the daily chart. We should remain vigilant regarding whether the pound will continue to weaken against the US dollar.
Today’s schedule includes Japan’s money supply at 8:50, Australia’s NAB Business Confidence Index at 10:30, Sweden’s expected price trends at 13:30, the Czech Republic’s Consumer Price Index and Switzerland’s Consumer Confidence Index at 16:00, and India’sConsumer Price Index, at 9:30 PM the Canadian Building Permits, at 10:00 PM remarks by U.S. Federal Reserve Vice Chair Jefferson and U.S. Federal Reserve Bank of Cleveland President Mester, at 12:30 AM the U.S. 3-month Treasury bill auction, and at 1:45 AM remarks by Swiss National Bank (SNB) Governor Jordan. We should remain highly vigilant regarding the downside potential for the pound, which has weakened against the U.S. dollar.
Author: Keisuke Sakurai
