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Forex Daily Recap – The Greenback was Beaten Badly Pushing to 97.18 Levels Post-FOMC Data

By:
Nikhil Khandelwal
Updated: May 1, 2019, 18:55 UTC

Optimism developed around the Pound pair, combined with upbeat UK PMI data helped the pair to upsurge. Lower crude prices and weak CAD April PMI bestowed the Loonie to recover last day’s losses.

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GBP/USD

The Cable which shot up more than 100 pips yesterday following optimistic Brexit news, continued the uptrend into today’s session. The GBP/USD started the Asian trading session near 1.3040 levels. The pair soared during the day after the release of positive reports, touching near 1.3093 levels. The UK April Markit Manufacturing PMI reported around 53.1 points over the estimates of 53.0 points.

GBPUSD 60 Min 01 May 2019
GBPUSD 60 Min 01 May 2019

However, the pair couldn’t grow much as some adverse events later dragged the Cable down. The April Consumer Credit recorded near £0.549B over consensus estimates of £1.000B. Also, March Mortgage Approvals released reports 2.51K lower to the market expectation of 64.850K. On the Brexit front, latest reports suggested that the UK Foreign Secretary Jeremy Hunt stood against electing new UK PM. The Secretary wanted to avoid as much as uncertainties, to get the Brexit to happen to the earliest. This positive news around the Brexit had strengthened the British Pound pair.

US Dollar Index

Today, the Greenback continued the slump rally which initiated on April 25. The pair rang the opening bell on Wednesday morning session near 97.50 levels. The Index was however found drifting near 97.27 levels at around 15:30 GMT. The US April ADP Employment Change had reported around 95K higher than the street estimate near 180K. The USD Index investors had now developed hopes for a probable recovery amid positive employment scores. But, the low numbers of the significant April ISM Manufacturing PMI shocked the Greenback investors. This US event was expected to come out bearish, reporting near 55.0 levels. Anyhow, the actual figures reported well below the expectation near 52.8 levels. Following the release of such a bearish event, the Greenback slipped from 97.42 levels landing near 97.32 levels. Laterwards, Lower-than-expected April ISM Prices Paid and March MoM Consumer Spending added to the plunge in the index. The Fed Interest Rate was decided in-line with the previous 2.5 percent, despite Trump’s comments for a rate cut.

USD/JPY

USDJPY 60 Min 01 May 2019
USDJPY 60 Min 01 May 2019

The week’s slump in the safe-haven pair that started near 111.90 levels had reached 111.14 levels today. The increased selling pressure on the Greenback had weakened the USD/JPY pair. During the Asian trading session, the pair was taking rounds near 111.41 levels. In the meanwhile, the sparse US ISM Manufacturing PMI led to the lowering in the US Treasury yields. This event had a significant impact on the Yen pair, pushing it more down. The USD/JPY pair had touched the lower vicinity during the day. It had then created fresh three-week low for the week near 111.09 levels.

USD/CAD

The Loonie had dropped 7.35 percent yesterday following BoC Governor Poloz’s optimistic outlook on the national economic growth. The pair, however, showcases some gains attempting to erase the previous day’s losses. The crude prices upsurged on the backdrop of rising crude inventories. Recently, the API had reported around 6.81 million barrels buildup in crude stocks. The result gets computed for the fourth week of April. The USD/CAD pair jumped from 1.3376 levels reaching near 1.3400 levels. The Near 13:30 GMT, the Canadian April Markit Manufacturing PMI reported 49.7 in comparison to 51.5 estimates. This bearish sentiment further helped the Loonie to climb upwards.

About the Author

Nik has extensive experience as an Analyst, Trader and Financial Consultant for Global Capital Markets. His vision is to generate Highest, Consistent and Sustained Risk-Adjusted Returns for clients over long term basis and providing them world-class investment advisory services.

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