Currency Pair Overview: Bullish Sentiment But No Volume

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Overall, the currency market showed signs of bullishness even from the first few trading hours of the European session, but until now, none of the major pairs have broken anywhere. Moreover, most currency pairs spent the overnight session trading in a 30-pip range around Thursday’s opening prices,, even though the equity markets have posted some considerable gains over the same period. For now, the currency market’s outlook lies to the upside against the dollar, but the major pairs will require much stronger volume than the volume seen up to now in order to move anywhere substantially.

The euro (EUR/USD) had a very weak trading session during the Asian and the European hours. The only thing the euro did during those two sessions was to move up and down around the price at which the Thursday session opened, around the 1.4230 area. On the daily chart, the euro is trading slightly above the 20-day moving average (1.4215), which could provide temporary support.

The pound (GBP/USD) tested the 1.6600 area during the European session, but retraced the move at a very strong pace. This happened even though the U.K. retail sales numbers came in much better than expected, something that should have had boosted the pair. Going forward, the 1.6600 area represents the next major resistance area that the pound has to break above, but this will only happen on positive equity days. If this does happen, the pair’s outlook will shift to the upside from mixed.  

The aussie (AUD/USD) screamed bullishness during the early trading hours, but until now, this has not materialized as the entire market lacks momentum and volume. Since the Thursday trading session begun, the aussie is the only major pair that was able break and sustain itself above the high of the prior day of trading (0.8300). 

The cad (USD/CAD) followed the same pattern as it does most of the time during the overnight session. As such, the pair saw a 30-pip range during the overnight session, while its trading volume remained very low. For now, the cad is struggling to break below the low of the prior day of trading (1.0950), something that is likely to happen only if helped by higher crude oil prices. 

The swissy (USD/CHF) spent an important part of the overnight session struggling to break below the 1.0650 level, something that the pair has done very rarely over the last three months of trading. However, if it actually does break lower, the swissy could continue its downtrend for a period of time and maybe even set a new low for the current year. However, for this to happen, it will need the entire market to follow. 

The yen (USD/JPY) gained approximately 50 pips during the Asian session, but the pair started to head lower shortly after the London open. For now, it is trading slightly above the neutral pivot point (94.20), which may provide intra-day support for the time being.

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