The Dollar Paradox: Rebounds on Bad US Data

Risk Aversion Deepens, Initial Jobless Claims Back in Focus

The dollar traded higher against all the other G10 currencies on Wednesday and during the Asian morning Thursday. It gained the most versus NOK, AUD, NZD, and CAD in that order, while it eked out the least gains against JPY and CHF.

NZD/JPY — Technical Outlook

Yesterday, NZD/JPY broke below its short-term tentative upside support line drawn from the low of March 23 rd. The pair is currently getting a hold-up near the 64.10 hurdle, which may force the rate to rebound slightly. That said, if NZD/JPY struggles to move back above that upside line, or above its EMAs on the 4-hour chart, the near-term outlook could stay somewhat bearish for a while.

AUD/USD — Technical Outlook

This morning, AUD/USD dropped below its short-term tentative upside support line taken from the low of March 19 th. Although such a move might be considered as a bearish one, still, the pair would need to overcome a few more hurdles before we could get slightly more comfortable with further declines. In order to examine a deeper extension to the downside a drop below the 0.6213 area would be needed. Until then, we will remain neutral.

As for the Rest of Today’s Events

During the European morning, we get Germany’s final inflation data for March, but as it is always the case, they are expected to confirm their preliminary estimates. Eurozone’s industrial production for February is also due to be released and the forecast points to a 0.2% mom slide after a 2.3% increase in January.

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