Forex Brokers Award 2021
Vote your favourite broker

The Week Ahead: Unity Makes Strength

Jun 1 2020, 02:36 PM (BDT) |

EURCHF Surges Higher on Stimulus Hopes


The euro climbed to an 11-week high against the Swiss franc after the European Commission proposed a 750 billion euro recovery plan. Optimism grows as the EU’s 27 nations are expected to settle their differences and seal the deal in the coming weeks. Should everything go smoothly from now on, confidence in the single currency could be restored.

With Swiss franc long positions near a four-year high according to CFTC data, EURCHF’s short-covering could trigger a rapid ascent. 1.7100 from last March is the immediate resistance.

On the downside, 1.0580 around the 30-day moving average is a key support to the rebound.

USDCAD Heads Lower Ahead of BoC Meeting


The US dollar has broken below its near two-month consolidation range as its Canadian counterpart rallied across the board. The V-shaped recovery in the oil markets which has reached a 5-week high has offered strong support to the loonie.

The Bank of Canada is expected to keep its policy interest rate at 0.25% this week. However, Governor Stephen Poloz has not excluded more stimulus to support the recovery.

The risk of dovish guidance could weigh on the loonie’s advance. The pair is under pressure after a breakout below the 1.3850 floor. As the rate starts to drift lower, 1.4050 is the immediate resistance.

USDJPY Pulls Back on Disappointing Data


Worsening US economic data have capped the greenback’s advance. The first quarter GDP sank 5% against a consensus of 4.8%.

Should this week’s manufacturing and jobs data paint a similarly grim picture, markets could shun the dollar unless the Fed comes up with even stronger commitment.

In the meantime, the US is pondering sanctions against China over a new Hong Kong legislation law, and the safe-haven Japanese yen may see more bids as Sino-US relations hit new lows.

USDJPY has failed to rally above the psychological level of 108.00. May’s low of 106.00 is a major support to keep the dollar afloat.

AUDJPY Rises on RBA’s Optimism


The Australian dollar continues on its way up as the country starts to resume its normal life. Despite a grim economic forecast of a 6% contraction and a 9% unemployment rate, the RBA has suggested the recession to be less severe than previously thought.

The central bank is likely to stay confident at its next meeting and maintain its current course of action without additional QE measures. This would further support the Aussie in the medium term.

Sentiment remains bullish after the pair rallied above the March high of 71.40. 70.00 near the moving averages is the first line of defense in case of a pullback.

At Orbex, the client is at the heart of everything we do and everything we do is designed to guarantee your satisfaction. Here’s how Forex Trading with Orbex will enhance your trading experience: Best-in-class customer service, including live chat and free webcall One-hour response time for sales and support requests Multiple asset trading and ECN accounts on MT4 0.9 pip fixed spread at ZERO commission Up to 1:500 leverage