EUR/USD, Forex market, Dollar

Analytical Overview of the EUR/USD, USD/BRL, GBP/USD, USD/JPY Pairs

EUR/USD tumbled down to a post-FOMC low as the greenback strengthened further on Thursday. The pair traded at 1.1840, reaching its lowest level since April 6. Meanwhile, the U.S. dollar continued rallying. The currency maintained its uptrend despite yesterday’s month and quarter end-trading.

However, several key events will take place in the following days, and they may change the currency course. One of the major ones is the non-farm payrolls release.

If EUR/USD plunges below the June 18 low of 1.1847, it will likely continue dropping towards 1.1800. The traders are looking for the USD/JPY moves. The pair broke above 111.00 yesterday, and if it continues growing, that will be another indicator of the dollar’s strength.

 What Is the Forecast for EUR/USD Pair in The Following 24 Hours?

 While the analysts had expected that the Euro would weaken on Wednesday, they still hadn’t anticipated a clear break of 1.1865. However, the common currency decreased further than experts predicted. EUR/USD dropped to 1.1843 before slightly recovering to 1.1855. Despite its rebound, the pair’s decline gathered momentum, and it still maintains a downtrend today.

Some analysts think that any weakness in the pair will likely be limited to 1.1825. According to them, the major support at 1.1800 will not come under threat.

Furthermore, a break of 1.1895 (minor resistance is at 1.1875) would indicate that the downward pressure has eased, and the Euro is rising again.

 Meanwhile, the USD/BRL Continues Its Bearish Trend

 The USD/BRL has produced a solid consolidated range during the past week. Even though the dollar rallied against most of the major currencies, the USD/BRL pair has shown a bearish trend since early June.

The pair began trading near 5.2100 on June 1, 2021. Currently, it is trading near 4.9550, though. USD/BRL climbed up slightly yesterday, but the move was rather insignificant.

It seems the USD/BRL pair is once again proving it is an outlier, opposing the dollar’s bullish trend. Forex traders need to consider this.

Currently, resistance near the 4.9700 level appears to be strong. As a result, traders should monitor this level closely today. Especially when considering that the greenback maintains its upper hand against other major currencies.

The USD/BRL may continue to traverse its correlated path. However, suppose the pair tests nearby resistance levels and finds them vulnerable. In that case, BRL traders may consider the 4.9900 to 5.0000 junctures targets for buying.

GBP/USD may drop below 1.3800 ahead of U.S. and U.K. PMI data

The strong buying pressure in the greenback also keeps GBP/USD gains under check. The pair continues to decline thus far in the session. Currently, GBP/USD exchanges hand at 1.3816, lower by 0.08% for the day.

Investors prefer safe-haven assets as the Coronavirus’ highly contagious Delta version spreads rapidly. The U.S. dollar traded near the 12-week high at 92.42 at last. The positive economic data further increases the currency’s price. According to a new report, in June, the Private Business added 692K jobs in the United States. That is a much higher number than the market expectations of 600K. Furthermore, the Pending Home sales data jumped by 13.1% in May on a YoY basis, after skyrocketing by a record 51.7% in April.

Meanwhile, the Fed officials hint that the agency may increase interest sooner than expected. According to Richmond Fed President Thomas Barkin, the central bank has made substantial progress towards its inflation goal to begin discussing the tapering of the stimulus.

On the other hand, the British Pound is struggling due to political uncertainties and slow economic growth. The surging Covid-19 infections in Britain have shaken the economic outlook. Despite that, the economy is still set to open by July 19.

The U.K. Gross Domestic Product reduced by 6.1% in the first quarter on a YoY basis while economic activity and demand decreased due to the tightening of pandemic restrictions.

The EU-UK political tussle due to Brexit also negatively affected Sterling’s performance. The U.K. expects to reach an agreement with the E.U. about extending the grace period for the post-Brexit trading agreement in Northern Ireland.

How did other major currencies fare today?

USD/JPY skyrocketed to 111.50 for the first time since March 25, 2020, jumping by 0.3% on Thursday. The dollar index hit 3-month highs at last, trading at 92.547 in early European deals, reaching its highest level since April 6, 2021.

Roberto Cobo Garcia, the FX strategist at BBVA, noted that the end of 2Q21 was accompanied by additional greenback gains against all FX major currencies as stronger than expected. Moreover, U.S. ADP data, lack of risk appetite in most equity markets, and optimistic comments from Atlanta Fed President Bostic helped the dollar yesterday.

The EUR/USD stood at $1.1851 at last. Meanwhile, the SEK/USD pair tumbled down in Europe, losing 0.3% against the greenback to trade at 8.57. The Swedish Crown also lowered by 0.2% against the Euro, exchanging hands at 10.16.  On Thursday, the Swedish central bank announced that it would keep its policy unchanged.

The AUD/USD declined by 0.2% to $0.7476, plunging to that level for the first time since Dec. 21. Australia’s major centers of Sydney, Perth, Brisbane, and Darwin remain under lockdown due to surging coronavirus cases.

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