CrossBorderBoost News

GBP/USD pair is extending the upside momentum in the early European session, touching the highest level in three days near 1.3775. Looking at the technical picture, a sustained strength beyond 200-hour SMA, around the 1.3780 region might be seen as a trigger for intraday bullish traders. That said, a modest US dollar rebound from three-week lows – amid a modest pickup in the US Treasury bond yields – might cap gains for the GBP/USD pair. The EUR/USD pair’s ability to stay strong beyond 200-day SMA, backed by the strongest bullish MACD signals since early December 2020 suggests the quote’s further upside. Though, a clear run-up past-50-day SMA level of 1.1965 becomes necessary for the EUR/USD buyers before confronting a horizontal area comprising multiple levels marked in March, around 1.1988-95. Meanwhile, a daily close below the 200-day SMA level of 1.1906 can recall EUR/USD sellers targeting the early March low near 1.1835. The dollar index was down 0.2% at 91.683, falling to its lowest level since March 22. USD/JPY fell 0.2% at 108.83, touching its lowest level in three weeks, while the risk-sensitive AUD/USD rose 0.5% to 0.7676. The U.S. consumer price index jumped 0.6% in March versus the previous month, the largest gain since August 2012, and rose 2.6% from a year earlier, both 0.1 percentage points above market expectations. While these figures were above consensus expectations, there were some in the market that expected a sharper rise in inflation given the extent of pent up demand on the back of hefty fiscal stimulus and a successful vaccination program.

GBP/USD rose 0.1% to 1.3748 after Britain's economy grew by 0.4% in February from January. The pound is also to pay attention to Scottish elections just before the vote – TDS. EUR/USD hovers around 1.1900 post-ZEW; EUR/USD remains apathetic in the 1.1900 neighbourhood. The dollar alternates gain with losses ahead of US CPI. German, EMU Economic Sentiment deflates in April. The pair is losing 0.10% at 1.1898 and a breach of 1.1704 (2021 low Mar.31) would target 1.1602 (monthly low Nov.4) en route to 1.1570 (2008-2021 support line). On the upside, the next up barrier is located at 1.1927 (weekly high Apr.8) followed by 1.1989 (weekly high Mar.11) and finally 1.2000 (psychological level). was up 0.1% at 92.210, only marginally higher than Thursday's low of 91.995, which was the weakest since March 23. USD/JPY rose 0.2% at 109.59 while the risk-sensitive AUD/USD fell 0.2% to 0.7610. The yield on the benchmark 10-year U.S. Treasury note has gained by about 2 basis points to just above 1.69% early Tuesday, after the Treasury auctioned $38 billion of 10-year paper on Monday, although this is still well below the 1.78% level hit on March 30, which was the highest in over one year. The greenback has eased back along with U.S. yields this month after surging to multi-month peaks on expectations that massive fiscal stimulus and a robust economic recovery will spur prompt the Fed to tighten faster than it is currently guiding. However, Fed officials have repeatedly stated that the central bank sees any near-term price pressures as transitory, and the central bank will want to see concrete improvements in inflation in employment before it tightens policy.

GBPUSD: Recovers from daily lows near 1.3670 as UK economy gears up for re-opening. GBPUSD cheered up on hopes of a gradual re-opening of the UK economy.UK Prime Minister Borris Johnson reminded people to behave ‘“responsibly”. However, the strength in the US dollar kept the momentum in check. EUR/USD faces selling pressure below 1.1900. EUR/USD extends Friday’s pullback to the 1.1870 region. USD buying remains behind the softer tone in the pair. EMU’s Retail Sales contracted 0.6% MoM in February. The dollar edged higher in early European trading Monday, but still traded near 2-1/2-week lows as the recent decline in Treasury yields undercut support for it. The dollar index was up 0.1% at 92.248, after falling below 92 late last week for the first time since March 23. USD/JPY fell 0.1% at 109.57, while the risk-sensitive AUD/USD fell 0.2% to 0.76095. Federal Reserve Chair Jerome Powell continued the mantra Sunday that near-term price pressures will prove transitory, and the central bank’s ultra-easy monetary policies were here to stay. He added the U.S. economy is at an "inflection point" with expectations that growth and hiring will pick up speed in the months ahead, but also noted risks that a hasty reopening could lead to a continued increase in coronavirus cases.

GBP/USD: Mix of British concerns with a rush to the dollar expose the  1.3670 critical support. EUR/USD struggles at the 1.1892 200-DMA, eyes  1.1860 support according to Credit Suisse. The dollar index was up 0.2%  at 92.278, after dipping as low as 92.037 earlier Friday for the first  time since March 23. The index has dropped around 0.8% this week, the  largest fall so far this calendar year. USD/JPY rose 0.2% at 109.47,  while the risk-sensitive AUD/USD fell 0.7% to 0.7595, after a warning  from Australia's central bank of excessive lending risk. Rising Treasury  yields amid expectations that a strong economic recovery and rising  inflation would force the Federal Reserve to rein in its ultra easy  monetary policies sooner than originally thought led to substantial  dollar gains last quarter. However, this tone has changed of late. The  weekly initial jobless claims figures on Thursday actually showed U.S.  unemployment unexpectedly rose last week, while the minutes for the U.S.  central bank’s last meeting showed that the officials remained  committed to monetary policy support for some time to come.

GBP/USD struggled to capitalize on its intraday positive move, despite a softer USD. Concerns over the disruption to the UK's vaccine rollout weighed on the sterling. The set-up support prospects for a retest of multi-week lows, near the 1.3670 area. EUR/USD to head towards 1.1950 on a break above 1.1889 – Credit Suisse  The dollar index was down 0.1% at 92.340, after dipping as low as 92.155 on Wednesday for the first time since March 23. USD/JPY fell 0.1% at 109.70, while the risk-sensitive AUD/USD was up 0.3% at 0.7635. The minutes for the U.S. central bank’s last meeting showed that the officials remained cautious about the country’s economic recovery from the ravages of the coronavirus pandemic, even while acknowledging that the recovery was gathering steam, and committed to monetary policy support until a rebound was more secure. Fed Chair Jerome Powell will speak at a virtual International Monetary Fund conference later on Thursday. Also weighing on the greenback has been the recent slide in bond yields. Although the benchmark 10-year Treasury yield last traded around 1.66%, after dipping below 1.63% during the previous session, this is still a far cry from the more than one-year high of above 1.77% late last month.

The sharp sell-off in GBP to an overnight low of 1.3802 came as a surprise. While the rapid drop appears to be overdone, there is room for GBP to dip below 1.3800. For today, the next support at 1.3750 is unlikely to come under threat (1.3770 is already quite a strong level). Resistance is at 1.3865 followed by 1.3890. GBP/EUR tested the downside of 1.16 early Wednesday, now trading around 1.1620. Economists at Credit Suisse expect the EUR/USD pair to remain in a mild downtrend while there is an asymmetry to further rate differential widening. Their expected Q2 range is 1.14-1.21 and they like to sell rallies towards 1.20. EUR/USD rallying to a two-week high of 1.1878, and the benchmark 10-year U.S. Treasury yield dropping sharply to 1.65%. Yet many investors still question whether the Fed can stick to its dovish stance, particularly given the recent employment data. Friday’s payrolls report was much stronger than expected while Tuesday’s data showed the job market is creating more opportunities at a faster clip than many economists and employers forecast. USD/INR soared 0.8% to 74.065, with the Indian rupee falling to the lowest level since November low after the country’s central bank kept its benchmark repurchase rate at a record low of 4% but cut its cash reverse ratio and also signalled readiness to act to support growth. The dollar index was up 0.1% at 92.390, just above a two-week low of 92.246, slipping further from a five-month high of 93.439 set at the end of last month. USD/JPY rose 0.1% at 109.78, while the risk-sensitive AUD/USD was down 0.2% at 0.7649.

The sharp sell-off in GBP to an overnight low of 1.3802 came as a surprise. While the rapid drop appears to be overdone, there is room for GBP to dip below 1.3800. For today, the next support at 1.3750 is unlikely to come under threat (1.3770 is already quite a strong level). Resistance is at 1.3865 followed by 1.3890. GBP/EUR tested the downside of 1.16 early Wednesday, now trading around 1.1620. Economists at Credit Suisse expect the EUR/USD pair to remain in a mild downtrend while there is an asymmetry to further rate differential widening. Their expected Q2 range is 1.14-1.21 and they like to sell rallies towards 1.20. EUR/USD rallying to a two-week high of 1.1878, and the benchmark 10-year U.S. Treasury yield dropping sharply to 1.65%. Yet many investors still question whether the Fed can stick to its dovish stance, particularly given the recent employment data. Friday’s payrolls report was much stronger than expected while Tuesday’s data showed the job market is creating more opportunities at a faster clip than many economists and employers forecast. USD/INR soared 0.8% to 74.065, with the Indian rupee falling to the lowest level since November low after the country’s central bank kept its benchmark repurchase rate at a record low of 4% but cut its cash reverse ratio and also signalled readiness to act to support growth. The dollar index was up 0.1% at 92.390, just above a two-week low of 92.246, slipping further from a five-month high of 93.439 set at the end of last month. USD/JPY rose 0.1% at 109.78, while the risk-sensitive AUD/USD was down 0.2% at 0.7649.

GBP/USD to gather stronger downside momentum below 1.3670 – OCBC “The GBP/USD pair range is narrowing to the 1.3700 to 1.3800 zone, potentially signaling a breakout. We expect it to be on the downside, especially as the USD remains on the ascendant and technicals are still more supportive of a downward move.” “Breach of 1.3670 needed for stronger downside momentum.” EUR/USD to resume its falls as Europe braces for further pain from the virus. The round 1.17 level provided support earlier this week and remains critical support. It is followed by 1.1630, 1.16 and 1.1550, all dating back to the autumn of last year. The dollar remained strong in early European trading Thursday, near multi-month highs amid expectations of strong U.S. economic growth, helped by more fiscal stimulus and an accelerating vaccine rollout. The dollar index was up 0.1% at 93.312, having hit a five-month high of 93.472 earlier. USD/JPY rose 0.1% to 110.78, having risen to as high as 110.97, its highest level in a year. The ADP report on Wednesday showed U.S. private payrolls increased by 517,000 jobs last month, a precursor to Friday’s official employment report which is expected to show another increase of around 650,000 payrolls in March.

The GBP/USD pair is trimming losses to head towards 1.3750 on the back of the comments. GBP/EUR remains at the low end of the key 1.17 level, trading above the 11-month high reached two weeks ago. The EUR/USD pair prolonged its recent bearish trajectory and dropped to a near five-month low, around the 1.1700 level. Relative Strength Index (14) has moved on the verge of breaking into oversold territory and warrants some caution for aggressive bearish traders. This makes it prudent to wait for some near-term consolidation or a modest bounce before positioning for any further depreciating move. The path of least resistance for the pair remains to the downside. Hence, any meaningful bounce might still be seen as a selling opportunity and remain capped near the mentioned confluence support breakpoint, around the 1.1760 zone. Some follow-through selling below the 1.1700 mark now seems to accelerate the fall further towards the 61.8% Fibonacci retracement level, around the 1.1620-15 region. This is closely followed by the 1.1600 mark, which if broken should pave the way for the continuation of the ongoing bearish trend. The dollar was up on Wednesday morning in Asia, rising to a fresh one-year high against the yen over investor bets that fiscal stimulus and an aggressive vaccine rollout will help the U.S. lead a global economic recovery from COVID-19. The dollar index inched up 0.08% to 93.370. The index held above the 93 mark and was on course for its best month since 2016. The USD/JPY pair was up 0.25% to 110.62, surpassing the 110 mark. The AUD/USD pair edged up 0.17% to 0.7607 and the NZD/USD pair inched up 0.07% to 0.6985. The USD/CNY pair inched down 0.07% to 6.5669 with the yuan offshore market the weakest since November 2020. Rising U.S. bond yields also gave the greenback a boost, with the yield on the benchmark 10-year Treasury note touching a one-year high of 1.776% on Tuesday.

GBP/USD has been under mild pressure as US yields boost the dollar. Even if the UK's immunization campaign somewhat slows down, it has reached nearly 50% of the population with at least one dose and the results are clear – cases and hospitalizations are falling. Moreover, London recorded no COVID-19 deaths on Monday – the first such feat in 2021. President Joe Biden is set to unveil his infrastructure spending plan on Wednesday and he may refrain from introducing new taxes in the first phase. That implies higher debt, more bond issuance, and therefore rising returns on Uncle Sam's IOUs. EUR/USD tumbles to new 2021 lows in the 1.1730 region. A test of the 1.1700 neighbourhood appears on the horizon. The dollar index was up 0.1% at 93.052, a new 4-1/2-month high.