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Daily FX Report

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Daria Efanova

Daria Efanova Head of Research

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EUR / USD

EURUSD

The EUR/USD currency pair is currently experiencing volatility due to mixed economic data from both the Eurozone and the United States. The Euro faces pressure from disappointing indicators like declines in German factory orders and Eurozone retail sales, yet it has shown resilience by climbing above the 1.0550 level. The U.S. dollar's weakening, driven by higher-than-expected unemployment claims, has supported the Euro, allowing the pair to test new highs.

Technical analysis indicates the EUR/USD is trading above a critical pivot point, with resistance around 1.0600, and a break above this level could signal further bullish momentum. However, downside risks remain, with support levels closely monitored, particularly around the 20-day SMA at 1.05.

The upcoming U.S. non-farm payroll report and potential European Central Bank rate cuts are expected to be significant market movers. Overall, the pair's outlook remains uncertain, with traders watching economic data releases for guidance.

USD / JPY

The USD/JPY currency pair is currently in a consolidation phase, with the exchange rate hovering around the 150.00 to 150.50 support level. Recent U.S. economic data, including a rise in initial jobless claims, has contributed to a slight weakening of the dollar against the yen. Traders are closely monitoring the upcoming Non-Farm Payrolls report, which could provide further direction for the pair.

A break below the 150.00 level could see the USD/JPY move towards the next support range of 147.00 to 147.50. Conversely, if the pair manages to break above the 50-day EMA, there is potential for a rally towards the 156 yen level. The recent surge in Japanese household spending has increased the likelihood of a Bank of Japan interest rate hike, adding another layer of complexity to the pair's dynamics.

GBP / USD

The GBP/USD currency pair is currently exhibiting a bullish trend, supported by strong UK economic data such as a robust Construction PMI and an unexpected rise in the Halifax House Price Index. Trading above the 1.27389 level, the pair reflects positive market sentiment, with technical indicators like the 50-day and 200-day EMAs reinforcing this outlook.

The US Dollar's weakness, due to mixed economic data including higher-than-expected unemployment claims, has further supported the GBP/USD's upward trajectory. Immediate resistance levels are identified at 1.27703, with further targets at 1.27932 and 1.28143, while key support levels are at 1.27136 and 1.26863. The pair's ability to maintain its position above the pivot point at 1.27389 is crucial for sustaining the bullish momentum.

However, the upcoming US non-farm payroll report could introduce potential volatility, impacting the pair's direction. Overall, the GBP/USD is poised for further gains, contingent on continued positive sentiment and economic performance in the UK, with traders advised to remain vigilant of US economic data releases.

EUR / CHF

The EUR/CHF currency pair is currently influenced by the European Central Bank's (ECB) monetary policy and political developments in Europe. The ECB's likely aggressive interest rate cuts to stimulate the eurozone economy could exert downward pressure on the euro, affecting the EUR/CHF pair.

Political instability in France adds to the uncertainty surrounding the euro, potentially increasing demand for the Swiss franc as a safe-haven currency. Despite these challenges, the euro has shown resilience due to expectations of continued ECB support through monetary easing. The EUR/CHF pair has recently exhibited a narrow trading range, with prices fluctuating between 0.929 and 0.932, indicating consolidation.

The current price is below significant moving averages, suggesting potential bearish sentiment. Overall, the EUR/CHF pair is likely to experience volatility in the near term, influenced by ECB policy decisions and European political developments.

Economic Calendar

06122024

Contents

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

This report was prepared with the assistance of artificial intelligence.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

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