Daily Forex Market Preview, 16/06/2017

The US dollar continued to post strong gains for the second day after the FOMC meeting. Despite weakening initially, the US dollar managed to close higher into the day. On the economic front, the SNB and BoE held their monetary policy meetings. For the BoE, it was a surprise as the MPC vote decision was 5 – 3. The news briefly sent the GBP higher before closing flat. The SNB’s meeting was largely a non-event.

Looking ahead, the Bank of Japan will be meeting shortly for its monetary policy decision. No major changes are expected from the BoJ. The interest rates are expected to remain steady. BoJ Governor Kuroda will be holding a press conference shortly.

EURUSD intraday analysis

EURUSD (1.1145): EURUSD closed bearish yesterday with price action expected to continue to decline. The technical support level at 1.1171 was breached yesterday, and this suggests further downside in price. EURUSD could be expected to continue to slip towards 1.1018 – 1.0995 support level over the medium term. On the daily chart, there is potential for a short-term retracement to occur. This could see EURUSD retesting 1.1171 price level where the broken support could turn to resistance in the near term. The bias shifts to the upside only on a close above this level.

GBPUSD intraday analysis

GBPUSD (1.2771): GBPUSD closed flat yesterday following the BoE’s surprise vote split. However, the gains are likely to be limited in the near term with the current decline looking to retest the resistance level of the broken neckline support of the head and shoulders pattern. The overall bias remains to the downside although this could change considering the strong consolidation taking place near this level. As long as GBPUSD stays below 1.2800, there is scope for price to push lower and complete the head and shoulders pattern.

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USDJPY intraday analysis

USDJPY (111.22): USDJPY has managed to post a strong recovery with price action breaking past the previous resistance level at 110.52. USDJPY is now seen extending the gains towards 112.00 – 111.70 resistance level. Any dips towards 110.52 will be a good buying opportunity for the market. Further gains can come only above 112.00, but it is unlikely that USDJPY will push higher. For the most part, expect some consolidation within 111.70 – 110.52

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