The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.
The Shared currency rebounded to $1.1770 as political wrangled over a U.S. relief plan, and the gloomy U.S. economic outlook kept investors shy of the U.S dollar.
The Cable recovered from an earlier set back of $1.3000 to $1.3080 after U.K. PM Boris Johnson's stimulus announcement for construction of homes and infrastructure worth £900m.
The Japanese Yen extended its losing streak against the U.S dollar to 106.10, ignoring upbeat Tokyo CPI reading in Asian session this morning.
The Aussie dollar trimmed losses to $0.7140 after the Reserve Bank of Australia left its monetary policy settings unadjusted for the third straight meeting, with the official cash rate maintained at a record low of 0.25% earlier today.
South Africa's rand tumbled to its weakest in a month at 17.20/dlr as concerns on the domestic economy compounded fears over a rise in global COVID-19 cases.
The Mauritian rupee mounted by 10 cents to 40.10(Selling) in the domestic market.
18:00 - USD - Factory Orders
After rallying from bottoming all time low at 101.20 to 111.71 in covid-fueled March period, dwarfing an expanding leading diagonal ((1)) in 5 waves, USD/JPY has ever since unfolded in a corrective double three combination pattern (W)-(X)-(Y) of wave ((2)).
From an Elliott Wave trading standpoint, the pair may experience further decline to the choppy downside to complete countertrend wave (Y) because- An impulse usually retraces to at least wave (4) of previous smaller trend, that is 105.19.
- Wave (4) of wave ((1)) coincides with 61.8% Fibonnacii retracement of wave ((1)), i.e 105.19.
- 78.6% projection wave (W) through (X) targets level 105.30.
- In EW lexicon, a pullback to the previous wave (2) usually happen to a leading diagonal ((1)).
- Post-triangle thrust measurement of wave B of (Y) leads exactly to 105.20.
- USD/JPY is still trading within the bearish parellel trendlines.
Thus, hibernation of price action could be seen in the locality of 105.30/19.On the flipside, a violent recoil to revive bullish momentum at 109.84 of June 4th would nullify this set-up, warning that the potency of positioning-derived bearish signal may be ebbing.
On the hourly Chart, The USD/CAD has found strong support again near $1.3350 region yesterday. The pair fell to as low as $1.3345 before bouncing off relentlessly to as high as $1.3444 this morning.
We feel that the USD/CAD could be in an early stage of a bullish run towards $1.4017 in the coming months.
On the downside, $1.3315 remains a strong baseline , while a break below that level would open the door for further weakness on the USD/CAD near $1.3200.