GBP Among the Main Losers, EUR’s Election Boost Stays Short-Lived

May to Step Down, Who’s next?

The pound traded lower against all but one of the other G10 currencies on Monday and during the Asian morning Tuesday. It underperformed the most against CAD, USD and JPY in that order, while the currency which failed to eke out any gains against GBP was SEK.

GBP/NZD — Technical Outlook

After hitting the psychological 2.0000 mark in the beginning of May, GBP/NZD reversed by 180 degrees and started drifting lower. This led to a break of the medium-term upwards moving trendline taken from the low of December 12th. At the same time, the rate continues to trade below its short-term tentative downside line drawn from the high of May 8th. Currently, the pair is balancing slightly below its key support area at 1.9350, which may be seen as another sign of weakness. For now, we will remain somewhat bearish and continue aiming towards lower levels.

EUR Gaps Up on EU Vote, but Retreats Thereafter

As for the overall results in the EU elections, pro-EU parties retained majority, despite Eurosceptics emerging stronger than previously. While Social Democrats and Conservatives lost the absolute majority for the first time in 40 years, their losses were offset by a strong showing for the Liberals and Greens, keeping the Parliament’s composition EU-friendly.

EUR/AUD — Technical Outlook

After breaking its short-term upside support line drawn from the low of April 21st, EUR/AUD kept on drifting lower and this morning the rate has fallen below yesterday’s low. Such activity doesn’t really give hope to the bulls, as the pair started forming lower highs and lower lows. For now, we will stay bearish and aim for slightly lower areas.

As for Today’s Events

The calendar continues to be relatively light today, with the only data worth mentioning being Switzerland’s GDP for Q1, which is already out, and the US Conference Board consumer sentiment index for May. The Swiss GDP accelerated to +0.6% qoq from +0.3%, while the US CB index is anticipated to have risen to 130.1 from 129.2.



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