European Currencies on Track to Yearly Highs

FXOpen

The first summer month saw a sharp rise in European and commodity currencies against the dollar. For instance, the pound/dollar is heading towards 1.2850, while the euro/dollar is set to test a significant resistance level at 1.0960. The surge in volatility at the beginning of the week was made possible thanks to the following events:

  • Yesterday at 17.00 (GMT +3:00) the release of the ISM Manufacturing Purchasing Managers' Index (PMI) for the US (48.7 versus a forecast of 49.8);
  • Yesterday at 17.00 (GMT +3:00) the publication of the ISM Manufacturing Prices Index for the US (57.0 versus a forecast of 60.0).

EUR/USD

Technical analysis of the eur/usd pair indicates the possibility of further growth towards 1.1100-1.1000, provided that the 1.0900 mark remains a support level.

In case of a break below the mentioned support, a test of 1.0880-1.0850 may be possible.

The following news releases may impact the pair's movement:

  • Today at 10.20 (GMT +3:00) speech by ECB Governing Council member Eduardo Fernandez-Bollo;
  • Today at 10.55 (GMT +3:00) release of the unemployment rate in Germany for May.

GBP/USD

After retesting the important support level of 1.2700, the gbp/usd pair rose by more than 100 points, demonstrating the formation of a "piercing candle" pattern on the daily timeframe. If the range of 1.2750-1.2700 maintains its support status, the price could continue to strengthen towards this year's highs at 1.2890-1.2860. A break below the 1.2700 level could lead to another approach towards 1.2600-1.2550.

The following events will be crucial for price movement:

  • Today at 17.00 (GMT +3:00) release of the US Job Openings and Labor Turnover Survey (JOLTS) for April (experts predict a slight decrease in the indicator);
  • Tomorrow at 11.30 (GMT +3:00) release of the UK Services Purchasing Managers' Index for May (experts expect 52.9 versus 55.0 last month).

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This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

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