USDJPY Sinks as Hope of Swift Recovery Fades
Confidence in the greenback has been shattered as the US is still grappling with a record surge in infection cases. Now that President Donald Trump has raised the possibility of delaying the November presidential election, markets saw this as a confirmation that the recovery would take much longer than expected.
Perhaps this week’s jobs data could offer some relief? An upbeat number may help lift the dollar in the short-term, though investors may favor the Japanese yen as a safer bet in the weeks to come.
The sell-off is heading toward 103.00. More selling interests could be around 107.20 in case of a rebound.
EURGBP Slides Ahead of BoE Guidance
The US dollar’s weakness has helped both currencies to gain strength over the past few days. But the cross is struggling to rise above last June’s high for lack of a fresh catalyst.
The Brexit noise is likely to stay subdued until new negotiations in September. The focus is now on who would fare better in the midst of a second wave.
A brighter Eurozone retail number may give the euro a nudge. The highlight will be the Bank of England’s forward outlook on Thursday, a dovish stance could add an extra floor to the euro.
As the pair retreats from the previous high of 0.9160, 0.8940 is the immediate support to keep the price afloat.
CADCHF Weakens as Oil Stalls
The Canadian dollar is having a hard time as global sentiment shifts to a more cautious approach. Rallies in oil prices have stalled so far, which put the commodity-linked loonie at a disadvantage against a safer Swiss currency.
In the meantime, the Ontario government is lifting lockdown measures across the country, sending a message that the economy may have seen its worst. A positive unemployment reading on Friday could inject some optimism in support of the loonie.
The price action has broken through April’s low of 0.6800. An extended sell-off may push the exchange rate towards 0.6600.
AUDJPY Consolidates Ahead of RBA Meeting
The Australian dollar has eased from its June’s high as a swift recovery might be off the table. Riskier assets like equity and commodity currencies are treading water near recent highs.
The Reserve Bank of Australia is expected to leave rates at an all-time low of 0.25%, and the market will focus on its guidance in light of the latest outbreak of coronavirus in Victoria. While a confident central bank could support the Aussie, global sentiment in regard to risk assets is more likely to dictate the course of action on the chart.
76.70 is a major hurdle ahead while the 30-day MA around 74.50 is a key level to maintain the current uptrend.