[EURUSD]
Important Levels to Watch for:
- Resistance line of 1.18673 and 1.19113.
- Support line of 1.17793 and 1.17353.
Commentary/ Reason:
The dollar hit a fresh 4-month high against the euro earlier Thursday as the U.S. pandemic response continued to outpace Europe’s, which has been hobbled by extended lockdowns and delayed vaccine rollouts and potential U.S. tax hikes.
The dollar also found support on reduced inflation concerns after Fed Chair Powell and Treasury Secretary Yellen testimonial remarks.
The dollar however pulled back against the euro, to trade at 0.07% lower at $1.18203.
The Germany’s reversal of a call for a strict lockdown over the Easter period was somewhat able to help the euro. German Chancellor Merkel cancelled a planned 5-day hard lockdown over the upcoming Easter holiday as harsh opposition to the lockdown prompted Merkel to say she made a “mistake” in backing the Easter lockdown.
The recent actions by France, Germany, and Italy to reimpose lockdown measures undercut the EUR/USD on concern that the reopening of the Eurozone economy will be delayed.
A slide in the 10-year German bund yield to a 5-week low Wednesday of -0.373% also weakened the euro’s interest rate differentials.
Comments from ECB Governing Council member de Galhau on Wednesday were dovish for ECB policy and negative for EUR/USD when he said the ECB sees "no risk of inflation overheating and that means we will keep interest rates low and very favourable financing conditions."
Eurozone economic data was supportive for EUR/USD after the Eurozone Mar Markit manufacturing PMI unexpectedly rose stronger and at the fastest pace of expansion since the data began in 2018. The Eurozone Mar Markit composite PMI also rose in its strongest pace of expansion in 8 months.
[USDCHF]
Important Levels to Watch for:
- Resistance line of 0.93914 and 0.94291.
- Support line of 0.93160 and 0.92782.
Commentary/ Reason:
The dollar eased against the Swiss franc on Thursday, traded 0.02% lower at 0.93541.
The sentiment and indicators however still take sides on the dollar.
Demand for the safe-haven greenback is favoured due to persistent concerns over a resurgence of COVID-19 and global lockdowns.
The dollar’s attraction was boosted as U.S. Federal Reserve officials appeared to tolerate rises in bond yields in recent weeks.
[GBPUSD]
Important Levels to Watch for:
- Resistance line of 1.37717 and 1.38427.
- Support line of 1.36297 and 1.35587.
Commentary/ Reason:
The British pound rose 0.15% to trade at $1.37037, bouncing out of a 6-week trough at $1.36735, touched overnight.
Lower T-note yields were negative for the dollar. The 10-year T-note yield fell to a 1-week low of 1.587%, falling further from last Thursday’s 14-month high of 1.753%.
