By CountingPips.com
The US dollar fell sharply across the board against the other major currencies last week in the forex trading action. The American currency continued to decline for a fourth straight week against the euro, the Swiss franc and the Japanese yen while falling against the British pound sterling for a third week. Against the commodity currencies, the the US dollar declined against the Canadian dollar for a second straight week while the Australian and the New Zealand dollars finally staged a rebound from their five-week bearish trends and recorded weekly increases.
Major Currency Pair Commentary:
EUR/USD: The euro gained against the US dollar for a fourth straight week last week and touched a high of approximately 1.3390 on Thursday. More upward momentum could setup a test of the major 1.3500 level this week. Important levels to watch for this pair this week start with the 1.3300 price level which will be an important support level for the bulls to keep price above in order to push this pair higher. Below the 1.3300, we could see potential support come in at the 1.3265 — 1.3250 area that has been a recent area of support and resistance and then the 1.3200 major level will come into play. If we see further upside momentum, price will have to get through the 1.3400 — 1.3380 area before we test the 1.3500 major level which is likely to attract traders attention and possibly heavy selling action.
GBP/USD: The British pound, similar to the euro, has really pushed higher in the last two weeks and just about reached the 1.5750 level for the first time since early February. The pair currently trades right at the 1.5700 major level which could likely provide support or resistance to begin the week. Downward momentum would bring up the 1.5600 level for support followed by the 1.5500 — 1.5520 area. Further upward price action possibly runs into 1.5750 resistance followed by overhead resistance at the 1.5875 — 1.5900 area.
USD/JPY: The Japanese yen gained against the dollar for a fourth straight week and really surged over the last two weeks. The pair now currently trades under the major level of 95.00 and sets up a potential reunion with the 92.50 major level that has been visited a few times already in 2013. The 95 level sets up as potentially the most important level of the week as a cross above this level will potentially signal the downtrend is losing steam while prices remaining below this level signals the trend has more room to run. More downward action would run into the 92.60 — 92.50 support area followed by more support at 91.00 — 91.25 area. Bullish price action would have to overcome the resistance of the 94.40 — 94.50 area and then the previously mentioned 95.00 major psychological level.
USD/CHF: The Swissy gained against the US dollar for a fourth week and has gone from the highs above the 0.9800 price to trading currently below 0.9250 in that time span. The pair currently trades right around the major 0.9200 level which will likely set up as either support or resistance to begin the week. Further downward momentum in this pair would likely see support coming in at the 0.9150 level with the 0.9100 level being, perhaps, the more important support for the week. The 0.9100 level has provided strong support earlier in 2013, in late 2012 and also earlier in 2012. If the dollar staged a comeback this week, we potentially see resistance into the 0.9250 level followed by the 0.9330 — 0.9350 area.
USD/CAD: The US dollar uptrend against the Canadian loonie has cooled off after touching the highest level in almost a year near the end of May above the 1.0400 level. The USD/CAD pair has fallen for two straight weeks and continues to trade back within the wedge pattern that looks to be decided in the coming weeks. The pair currently trades right near the 1.0150 level with overhead resistance to be found near the 1.0180 — 1.0200 area and to be followed by the 1.0250 resistance area. Further decline will likely see support seeing at the 1.0100 — 1.0120 area followed by the major psychological level of 1.0000.
AUD/USD: The Aussie rebounded last week after falling for five straight weeks and trades above the 0.9500 level. The 0.9650 level shapes up as a very important level for the week as whether prices trade above or below this level may determine whether the Bulls can stage a further rebound or if the Bears punish this currency lower. This level has provided key support over the past few years for this pair and also was a major resistance level that prices bounced off of during the downtrend in 2008. Upward momentum for the AUD/USD will potentially run into last week’s resistance just above the 0.9650 area while downward support may be found at the 0.9350 level and then the 0.9275 — 0.9250 area.
NZD/USD: The New Zealand dollar rebounded sharply last week and made it back to close over the 0.800 psychological level. Further upward momentum will run into overhead resistance at the 0.8050 level. Next up the line would be the 0.8100 area followed by the 0.8180 — 0.8200 area. Bearish momentum on the week will likely see a retest of the 0.8000 major level with further support being potentially found at the 0.7930 — 0.7900 area.
This Week’s Economic Calendar highlights:
Monday, June 17
Canada — existing home sales
Tuesday, June 18
Australia — reserve bank meeting minutes
United Kingdom — producer price index
United Kingdom — consumer price index
United Kingdom — retail price index
euro zone — German ZEW report
United States — consumer price index
United States — housing starts and building permits
Japan — trade balance
Wednesday, June 19
Switzerland — ZEW survey report
United Kingdom — bank of England minutes
United States — F0MC interest rate decision
New Zealand — GDP report
Thursday, June 20
Switzerland — interest rate decision
Switzerland — trade balance report
China — HSBC manufacturing PMI
Japan — leading index/coincident index
euro zone — purchasing managers indexes
United States — weekly jobless claims
United States — Philadelphia Fed reserve survey
United States — leading indicators
United States — existing home sales
Friday, June 21
Canada — consumer price index
Canada — BOC consumer price report
Canada — monthly retail sales
See our full economic calendar for more events.
Written by Zac Storella, CountingPips Forex Blog & Currency Pair Technical Analysis
