Daily Forex Analysis - 17th June 2021

USD Overview (17 June 2021)

Yesterday, USD strengthened against all the major currencies after the hawkish tone sent out by the Federal Reserve.

The U.S. housing data released yesterday indicated a decline in the number of building approvals issued and the number of residential buildings that began construction in May.

- Building Permits (Actual: 1.68M, Forecast: 1.73M, Previous: 1.73M revised from 1.76M)

- Housing Starts (Actual: 1.57M, Forecast: 1.64M, Previous: 1.52M revised from 1.57M)

During the monetary policy meeting earlier today, the Federal Reserve kept its monetary policy unchanged. In the interest rate statement, the central bank continues to acknowledge that recent inflation is due to transitory factors. The Fed also acknowledged that the progress on vaccinations has slowed down the spread of the pandemic in the U.S. and that the progress will “likely continue to reduce the effects of the public health crisis on the economy”.

In the released projection materials, the committee members have revised their projections on GDP and inflation upwards in the near future while unemployment rate remains pretty much the same except for a slight downward revision in 2022. The dot plot indicated that 7 members expect interest rate to increase in 2022 as compared to 4 members back in March while 13 members expect a rate hike in 2023 as compared to 7 members back in March.

During the press conference, Fed Chair Powell highlighted that there has been initial discussions on when the central bank should be cutting back on its quantitative easing.

The Unemployment Claims data (Forecast: 360K, Previous: 376K) will be released later at 2030 (GMT+8).

NZD/USD Outlook (17 June 2021)

Overall, NZD/USD is trending downwards. Recently, NZD/USD broke below the support zone of 0.71000 after the hawkish tone sent out by the U.S. Federal Reserve.

The New Zealand GDP q/q data (Actual: 1.6%, Forecast: 0.5%, Previous: -1.0%) released earlier today indicated a rebound in economic growth during the first quarter of 2021 from the previous quarters decline.

Currently, NZD/USD is moving towards the resistance zone of 0.72850 and the next support zone is at 0.69500.

Look for short-term selling opportunities of NZD/USD if it rejects the resistance zone of 0.72850.

AUD/USD Outlook (17 June 2021)

Overall, AUD/USD is trending downwards. Recently, AUD/USD weakened after the hawkish tone sent out by the U.S. Federal Reserve.

In his earlier speech, the Reserve Bank of Australia (RBA) Governor Lowe highlighted that after the review by the central bank on a range of possible scenarios, “some conditions for an increase in the cash rate could be met during 20204, while in others these conditions are not met”. Thus, the RBA will have to review these scenarios again during its next policy meeting.

The Australian employment data will be released later at 0930 (GMT+8).

- Employment Change (Forecast: 30.5K, Previous: -30.6K)

- Unemployment Rate (Forecast: 5.5%, Previous: 5.5%)

Currently, AUD/USD is moving towards the key level of 0.76. Its next support zone is at 0.75500 and the next resistance zone is at 0.78000.

Look for short-term selling opportunities of AUD/USD if it breaks below the key level of 0.76.

USD/JPY Outlook (17 June 2021)

Overall, USD/JPY is trending upwards. Recently, USD/JPY strengthened and broke above the key level of 110 after the hawkish tone sent out by the U.S. Federal Reserve.

Currently, USD/JPY is testing the resistance zone of 110.800 and the next support zone is at 108.500.

Look for buying opportunities of USD/JPY if it breaks the resistance zone of 110.800.

EUR/USD Outlook (17 June 2021)

Overall, EUR/USD is trending downwards. Recently, EUR/USD weakened and broke below the key level of 1.21 after the hawkish tone sent out by the U.S. Federal Reserve.

The eurozone final CPI y/y data will be released later at 1700 (GMT+8).

- Final CPI y/y (Forecast: 2.0%, Previous: 2.0%)

- Final Core CPI y/y (Forecast: 0.9%, Previous: 0.9%)

Currently, EUR/USD is testing the support zone of 1.19700 and the next resistance zone is at 1.21500.

Look for short-term selling opportunities of EUR/USD if it breaks the support zone of 1.19700.

GBP/USD Outlook (17 June 2021)

Overall, GBP/USD is trending downwards. Recently, GBP/USD weakened after the hawkish tone sent out by the U.S. Federal Reserve.

The UK CPI y/y data released yesterday indicated an increase in annual inflation in May. Inflation rate has now hit the Bank of Englands 2-3% target range.

- CPI y/y (Actual: 2.1%, Forecast: 1.8%, Previous: 1.5%)

- Core CPI y/y (Actual: 2.0%, Forecast: 1.5%, Previous: 1.3%)

Currently, GBP/USD is testing the support zone of 1.40000 and the next resistance zone is at 1.43500.

Look for short-term selling opportunities of GBP/USD if it breaks the support zone of 1.40000.

USD/CAD Outlook (17 June 2021)

Overall, USD/CAD is trending upwards. Recently, USD/CAD broke above the resistance zone of 1.22400 after the hawkish tone sent out by the U.S. Federal Reserve.

The Canadian CPI m/m data (Actual: 0.5%, Forecast: 0.4%, Previous: 0.5%) released yesterday indicated that inflation remained the same as previous month.

Currently, USD/CAD is moving towards the key level of 1.23. Its next support zone is at 1.22400 and the next resistance zone is at 1.23800.

Look for buying opportunities of USD/CAD if it breaks above the key level of 1.23.

GBP/JPY Outlook (17 June 2021)

Overall, GBP/USD is ranging across. Recently, GBP/JPY tested but failed to break above the key level of 155.

The UK CPI y/y data released yesterday indicated an increase in annual inflation in May. Inflation rate has now hit the Bank of Englands 2-3% target range.

- CPI y/y (Actual: 2.1%, Forecast: 1.8%, Previous: 1.5%)

- Core CPI y/y (Actual: 2.0%, Forecast: 1.5%, Previous: 1.3%)

GBP/JPYs next support zone is at 153.000 and the next resistance zone is at 156.000.

Look for selling opportunities of GBP/JPY.

EUR/JPY Outlook (17 June 2021)

Overall, EUR/JPY is ranging across. Recently, EUR/JPY broke below the key level of 133.

The eurozone final CPI y/y data will be released later at 1700 (GMT+8).

- Final CPI y/y (Forecast: 2.0%, Previous: 2.0%)

- Final Core CPI y/y (Forecast: 0.9%, Previous: 0.9%)

Currently, EUR/JPY is testing the support zone of 132.800 and the next resistance zone is at 134.300.

Look for selling opportunities of EUR/JPY if it breaks the support zone of 132.800.