Forex Morning Briefing
$DXY, $EUR, $GBP, $JPY
Commentary: The release of FOMC’s May dovish minutes seems to have had opposite effects on USD strength and US yields. While a stronger indication of a rate hike in June imparted strength to USD, its tolerance for inflation above 2% pushed yields down. PE
The US Dollar (.DXY) Index at 93.908 re-tested 94 Wednesday marking a high at 94.19. Now seeing a dip to support at 93.3-93.7, and the target at 95 could be tested next week, or the week after that, where it will be capped at 95.
EUR (Euro) at 1.171 dipped and marked a low of 1.1676 Wednesday. The single currency could rise to 1.175. A test of 95 by .DXY in the next 1-2 weeks may imply EUR test to 1.155 or lower.
USD/JPY at 109.64 broke support at 110.5 Wednesday as President Trump’s proposal to impose tariffs on imported cars brought some uncertainty and volatility into the markets. JPY, considered as a safe haven, strengthened. We wait, we see.
EUR/JPY at 128.33 broke support at 129.5 as USD/JPY and EUR both turned extremely Bearish Wednesday. A clear break of 128, make the pair Bearish to 126.
Sterling (GBP) at 1.3366 move to channel support on the daily and broke to a low of 1.3305. It is currently trading slightly higher. GBP could turn more Bearish soon to support at 1.31.