EUR/usd
Did you like it? Several factors coincided at once to provoke heavy selling in the dollar, which only in eurusd resulted in a move of 270pips from the daily low to the daily high. Moreover, having risen from 1.3090 to 1.33 for less than five hours after draghi's speech, at night the single currency was consolidating at 1.3340, it means traders have gathered their profits and do not hurry to purchase dollars. Let's look into the reasons. First of all, during the day the US currency was gradually weakening as a result of the preceding poor statistics, which reduced the likelihood of stimulus rollback by the Fed in the near future. Unlike the Beige Book, whose tone was a bit more optimistic than before, economic indicators didn't promise that May would be better than April. Draghi made it clear at the press conference that now the Bank is farther from cutting the rates than it was at the beginning of May. The Committee has slightly worsened the GDP estimate for this year (-0.6% against -0.5% earlier), but raised the expected rate for the next year (from 1.0% to 1.1%). Further technical factors came into the arena. There are usually lots of pending orders placed before the release of payrolls, this time they started triggering on the rally. Then weakening of the US dollar started to affect not only the euro, but became obvious across the board, including the sterling.
GBP/USD
The British currency almost didn't stir on the decision of the CB to preserve the status quo, but fluctuated much under the influence of exterior factors. As a result, the pair rose from 1.5370 to 1.5680. So, over a few hours it not only reached the highs of early May, but even exceeded them. It's also very important that now the market is consolidating above 1.56, which was not reached then. Now the market is likely to freeze right till the release of payrolls. The latter can either confirm the phase of the dollar decline, or severely punish the bulls. The second variant is possible should the released statistics be strong, but we can scarcely believe in it. Apparently, selling of the dollar will continue, though probably at a less impressive pace.
USD/JPY
There was one more factor behind weakening of DXY by 2% yesterday. It was quite an unexpected statement of Japan's Finance Minister Aso that he was not going to launch interventions against the yen in the near future. As a result, usdjpy plunged from 99.30 to 95.85 and is now trading close to 96.40. The level of 96 is another support line, where we can possibly expect gradual purchases of the pair.
AUD/USD
Yesterday even the beaten Aussie got a chance to revive the customs of the old days, that is to make a show of its former strength. audusd from the multi-month low of 0.9430 went up to the daily high of 0.9670, but unlike all the above-mentioned currencies, it was the first to lose all its gains against the dollar. The Aussie is weak and is purchased for the long term only by strategic players, who understand that finally the currency of the country , which heavily exports to China and hasn't suffered recession for over 20 years, will definitely rise much higher.
