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18.05.2023 Market Report


EUR/USD fades bounce off six-week low as US Dollar grinds higher at nearly two-month top. Softer EU inflation, downbeat tone of ECB’s de Cos weigh on Euro price. Optimism surrounding US debt limit extension, recent increase in Fed bets supporting June rate hike favor US Dollar.


The GBP/USD pair is displaying a back-and-forth action below the 1.2500 mark in the Tokyo session. The Cable is failing to deliver decisive action amid the absence of critical triggers. The USD Index is making efforts for defending its downside near 1.2480.


The USD/JPY pair is gathering strength for printing a fresh five-month high above 138.00 in the Asian session. The asset has got immense strength as the Bank of Japan (BoJ) is expected to continue keeping its monetary policy loose enough to sustain inflationary pressures at elevated levels.


AUD/USD has shown some selling pressure after a recovery move to near 0.6650 in the Asian session. The Aussie asset witnessed an extreme sell-off in early Asia after the release of the downbeat Australian Employment data. A sheer slowdown has been witnessed in Australian Employment generation as firms are facing pressure due to higher interest rates from the Reserve Bank of Australia (RBA).


NZD/USD struggles to cheer New Zealand’s (NZ) no-frills budget as it stays defensive near 0.6250 during early Thursday, despite recently bouncing off intraday low. The reason could be linked to the US Dollar’s latest grinding towards the north, after refreshing the multi-day high the previous day.


USD/CAD seesaws around the intraday top of near 1.3470-75 heading into Thursday’s European session. In doing so, the Loonie pair buyers cheer recently easy Oil price and the US Dollar’s sturdy moves at the multi-day high amid a sluggish performance of the market. That said, the WTI crude Oil prints mild losses near $72.60 as it consolidates the biggest daily gains in two weeks amid slightly offbeat market conditions. Adding strength to the bearish bias surrounding the black gold is the US Dollar’s strength and expectations of slower energy demand, mainly due to softer China data and recession woes in the West.


USD/CHF remains steady around 0.8980-85 as bulls take a breather amid early Thursday’s sluggish session, after refreshing the monthly high. In doing so, the Swiss Franc (CHF) pair portrays the market’s indecision amid a light calendar and lack of macros as the US default looms. However, the latest optimism about the debt limit extension puts a floor under the prices.


Oil prices edged lower on Thursday after logging sharp gains in the prior session as markets awaited more cues on the potential lifting of the U.S. debt ceiling, with a slew of economic and monetary policy indicators lined up for later in the week.


Gold is replicating the moves seen in Wednesday’s Asian trading, making headways for a minor recovery toward $2,000 early Thursday. The retreat in the United States Dollar (USD) and the US Treasury bond yields is lending support to XAU/USD price.  

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