Market Update - 17 May 2023

EUR/USD has faced selling interest after a short-lived pullback to near 1.0873. A mild expansion is US Retail Sales is insufficient to impact expectations for a steady monetary policy by the Federal Reserve. The street is anticipating more than one interest rate hike from European Central Bank. EUR/USD has dropped below the 38.2% Fibonacci retracement at 1.0876. (FXStreet)

USD/CHF picks up bids to refresh intraday high, extends previous recovery. Upbeat oscillators, sustained trading beyond 200-HMA favor Swiss Franc sellers. One-month-old descending resistance line, nearly overbought RSI conditions prod pair buyers. Sellers need validation from the fortnight-long ascending support line. (FXStreet)

The index extends the bid bias near 103.00 on Wednesday. The debt ceiling issue remains in centre stage as driver of sentiment. Mortgage Applications, housing data next on tap in the docket. The greenback, in terms of the USD Index (DXY), adds to Tuesday’s gains and revisits the area of multi-week highs in the 102.80/90 region on Wednesday. (FXStreet)

USD/JPY retreats from intraday high, stays sluggish around two-week top, after strong Japan GDP growth. Hawkish Fed bets, upbeat US data favor Yen pair buyers. US policymakers appear optimistic about avoiding default after the latest debt ceiling talks. Second-tier US, Japan data eyed for intraday clues, risk catalysts are the key for clear directions. (FXStreet)

GBP/USD stays pressured after retreating from weekly top. Unimpressive UK employment figures contrast with positive surprise from US data to prod Pound Sterling buyers. BoE, Fed officials cite inflation, employment numbers to defend hawkish plays. Easing fears of US default joins hopes of witnessing upbeat comments from BoE Governor Bailey to challenge Cable bears. (FXStreet)

USD/CAD is eyeing to reclaim the 1.3500 resistance amid a solid recovery in the USD Index. The postponement of US debt ceiling issues till the weekend has weighed on US Treasury yields. The oil price has dropped sharply as investors are worried about deepening fears of a US recession. (FXStreet)

AUD/USD reverses from intraday high amid fresh challenges to sentiment. Australia cancels quad meeting on Biden’s change of schedule. Aussie Wage Price Index remains unchanged on QoQ, improves on YoY. US policymakers appear hopes of avoiding default but lack of details raise doubts on optimism. (FXStreet)

EUR/GBP has climbed sharply above 0.8700 as the BoE is expected to pause its rate-hiking spree ahead. Downbeat UK Employment data adds to factors advocating for a pause in the policy-tightening spell by the BoE. ECB Lagarde already confirmed that more than one interest rate hikes are in pipeline. (FXStreet)

GBP/JPY defends the previous day’s retreat from one-week high, retreats on upbeat Japan Q1 GDP. U-turn from monthly resistance line directs cross-currency pair towards 170.00 support confluence. Bears need validation from 200-SMA and BoE Governor Bailey. (FXStreet)

USD/INR struggles for clear directions after snapping three-day uptrend the previous day. One-month-old horizontal region, ascending trend line from May 07 limit immediate moves of Indian Rupee pair. Upbeat RSI (14) suggests continuation of northward grind; 200-SMA acts as the last defense of USD/INR bulls. (FXStreet)

NZD/USD retreats from intraday high but prints mid gains as risk dwindles. Doubts about US policymakers’ optimism for debt ceiling extension, hawkish Fed talks and upbeat data weigh on Kiwi pair. Positive expectations from New Zealand budget allow NZD/USD to grind higher amid light calendar. (FXStreet)

Prices of the WTI appears to have moved into a consolidative phase so far this week. Tuesday’s negative price action was accompanied by shrinking open interest and volume and is indicative that the continuation of the downtrend looks out of favour for the time being. So far, the $70.00 mark per barrel should act as an initial contention zone. (FXStreet)

Tuesday’s marked retracement in gold prices was on the back of diminishing open interest and suggests that extra weakness seems unlikely for the time being. The commodity, in the meantime, is expected to meet the next support of note around $1970, where coincides lows seen in the second half of April and the temporary 55-day SMA. (FXStreet)

Silver consolidates the overnight slide to its lowest level since early April. The setup favours bearish traders and supports prospects for further losses. Any attempted recovery is likely to remain capped near the $24.25-30 area. Silver enters a bearish consolidation phase on Wednesday and oscillates in a narrow trading band around the $23.70-$23.75 area, just above its lowest level since April 3 touched the previous day. (FXStreet)

Source: FXStreet

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