Equities Correct Lower, UK CPIs Miss, Canada’s CPIs in Focus

Risk Appetite Softens, UK Inflation Slows, Canada’s CPIs Take Turn

The dollar traded lower against all but one of the other G10 currencies on Tuesday and during the Asian morning Wednesday. It gained only against JPY, while the currencies against which it lost the most ground were NZD, NOK, and GBP in that order. The greenback underperformed the least versus CAD and CHF.

EUR/GBP — Technical Outlook

Although EUR/GBP declined yesterday, it is still balancing slightly above a short-term upside support line taken from the low of May 11 th. It seems that the bulls are desperately trying to keep the pair afloat, but in order to get a bit more comfortable with higher levels, we would like to see a break above the current highest point of May, at 0.8960. Until then, we will stay cautiously bullish.

USD/CAD — Technical Outlook

After peaking in mid-March, USD/CAD continues to form lower highs, however it seems to be struggling to move below the 1.3855 hurdle, which keeps on providing decent support. Given such an activity, the pair is forming somewhat of a descending triangle, which tends to break lower, according to the TA rules. That said, before we could get comfortable with examining lower areas, we would like to see a break of the 1.3855 level first, hence why we will take a cautiously-bearish stance for now.

As for the Rest of Today’s Events

Ahead of the Canadian CPIs, we get Eurozone’s final CPIs for April, but as it is always the case, they are expected to confirm their initial estimates.

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