GBP Surges, SEK Tumbles, Fed Minutes Take Center Stage

Cable Surges Above 1.3000, Krona Slides on Disappointing Inflation

The dollar traded lower against most of the other G10 currencies on Tuesday. The big gainer was GBP, with NOK taking the second place, but still well behind the British currency. The greenback gained only against SEK and JPY, while it traded nearly unchanged against NZD.

GBP/CHF — Technical Outlook

The British pound suddenly got a boost during yesterday’s European trading session, when the currency gained against all of its major counterparts. With the swiss franc being no exception, GBP/CHF pushed higher, broke the short-term downside resistance line taken from the high of January 27th and travelled higher to find good resistance near the 1.3080 barrier. The pair is now trading above a steep short-term upside support line, taken from the low of February 14th, which if not broken, could support the bulls in pushing GBP/CHF further up.

USD-Traders Lock Gaze on FOMC Meeting Minutes

Back to the dollar, today USD-traders are likely to fix their gaze on the minutes of the latest FOMC gathering. At that meeting, the Committee kept interest rates unchanged as was broadly anticipated, but in the statement accompanying the decision, officials decided to remove the part suggesting that “some further gradual increases” are warranted and instead noted that they will be “patient” in determining what future adjustments to interest rates may be appropriate. What’s more, the Committee issued a separate statement, in which they announced that they would be prepared to use their full range of tools, including altering the size and composition of their balance sheet, if needed. At the press conference following the decision, Fed Chair Jerome Powell said that the case for rate increases has “weakened” and that they decided to adopt a “patient, wait-and-see approach”.

NZD/USD — Technical Outlook

Yesterday, NZD/USD was driven higher by a strong buying activity after initially sliding to find support near 0.6815. The pair managed to reach Monday’s highs, near the 0.6885 barrier, where it found good resistance. Overall, NZD/USD keeps trading above its medium-term upside trendline taken from the low of October 8th, at the same time the pair is sitting above a short-term tentative upside line, drawn from the low of January 3rd. For now, even though we may see a small retracement back down, in our view, there could still be steam left in the bulls and we might see another push higher. We will take a more cautious approach for now and wait for a confirmation break through one of our key levels.

As for the rest of Today’s Events

Besides the FOMC meeting minutes, the calendar appears relatively empty with regards to economic releases. The only worth mentioning relates to the energy market and it is the API (American Petroleum Institute) weekly report crude oil inventories, but as it is always the case, no forecast is available.

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JFD is a leading Group of Companies offering financial and investment services and activities.