Forex Recap – Greenback Managed to Hold Gains Despite Adverse US Data
Today, the Greenback kept hold onto the gains attained on July 1 and kept the uptrend intact. The early gains came in the USD Index amid Fiber downfall. The EUR/USD pair was down in the Asian trading session on the backdrop of adverse economic data. Meantime, another Greenback rival, GBP/USD pair, extended the previous day’s tumbling rally. The Cable had slipped, reaching a two-week bottom, after the release of weaker June UK Markit Services PMI. However, the morning advancements got limited in the early European session.
Lower-than-expected economic data slowed down the Greenback Bulls. The US June ADP Employment Chan ge report ed 32K below the market estimates of 140K. Also, the May Trade Balance came near -$55.5 billion in comparison with the -$54.0 billion forecasts. Higher-than-estimated Continuing Jobless Claims computed since June 21 further poured some cold water over the USD Index. Though the June Markit PMI figures remained above-the-market expectation, the most crucial ISM June Non-Manufacturing PMI further took charge of the bearish sentiment. The ISM PMI statistics recorded near 55.1 points over 55.9 points hopes.
Quite surprisingly, the drowning in the US Dollar Index found a stoppage near the robust 96.60 support mark and rebounded upwards. At around 15:52 GMT, the US Dollar Index was trading near 96.80 mark.
After opening near 0.6994 level on Wednesday, the Aussie pair remained sustained within 0.6990/0.7000 range level in the initial hours. Somehow, the pair took the flight from 0.6989 level in the Asian session, breaking the healthy 0.7000 resistance handle. This positive drift activated a strong uptrend, making the AUD/USD pair reaching 0.7038 level. Earlier the day, upbeat Australian economic data also entertained the bulls. The May MoM Building Permits recorded 0.7% higher than the market estimates of 0.0%. Also, the May Trade Balance reported 5,745 million over 5,250 million forecasts. Despite appealing AUD-specific data, the Aussie pair hesitated to make a move following downbeat Chinese June Caixin Services PMI data release.
Another disappointing day for the Cable traders. The GBP/USD pair continued to decline today, making the downtrend intact for the third day in a row. The pair initiated day’s trading near 1.2596 level and kept plunging throughout the day. However, the downward movements couldn’t move beneath the active 1.2559 support line. The UK June Markit Services PMI recorded a weaker report. The Market had expected the figure to remain in-line with the last 51.0 points. Somehow, the actual reports came near 50.2 points disappointing the market participants.
Though there were some small upside drifts in the price actions, the GBP/USD pair remained capped under 1.2592 level. Meantime, the UK leadership frontrunner, Boris Johnson, reiterated his Hard Brexit stance, unnerving the Britishers.
The Loonie pair started the day near 1.3098 level and maintained a slight upliftment, touching 1.3120 level. From there, the pair marched southwards, reaching the day’s lowest point near 1.3062 level in the afternoon session. The rigorous downfall in the price actions as Canadian Dollar soared over positive CAD Trade data. Both the April Imports and May Exports reports came above the market hopes. The May International Merchandise Trade published positive $0.76 billion over a negative $1.50 billion estimates. In the middle of such optimistic Canadian reports, adverse USD-specific data added more oil to the fire.
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