Trading plan for June 4
US Dollar remains under bearish pressure for a second day in a row with the USD index falling below 96. Even the strong statistics fails to support the greenback: trade deficit narrowed, while the ADP NFP came at 201K. The reason for the USD weakness is growing optimism on the Greek issue and rising European yields. Tomorrow we’ll watch the unemployment claims, while on Friday the market will focus on May NFP.
EUR/USD jumped above 1.1200 on Wednesday. ECB left monetary policy unchanged,while Mario Draghi cheered the market up with optimistic comments on theinflationary prospects. Anyway, we don’t expect the rally to be long-lived. The 1.1300/1500 area will likely be highly resistive. Support is seen at 1.1050.
GBP/USD consolidates around 1.5300. The BOE meeting on Thursday will likely be a non-event. The recent economic weakness lowers the market expectations for a rate hike. We expect the cable to come under a renewed pressure with a target around 1,5160.
USD/JPY is driven mostly by the US rate hike expectations these days. Trend resistance lies at 124.60/125.00. Strong US data may provoke a break higher, but then the Japanese officials could intervene verbally. Support is seen at 123.60/70.
AUD/USD bounced from 0,7600 and soared by 200 pips in 2 days. Support is seen at 0,7750. We’ll be watching retail sales and trade balance tomorrow.