Major currencies update: The Euro remains to trade in a rangebound fashion from yesterday through today’s Asian session. After light trading on Monday on the US Labor Day Bank Holiday, stops at 1.1180 – 1.1200 were run to the upside momentarily, before the pair stabilized back at 1.1170. Spot currently trades at 1.1180. The Pound continued its ascent, set for its second 100+ pip up-day, after its relative inactivity during the last couple of weeks’ bout of risk aversion. Improving risk sentiment, and M&A chatter of Tesco looking to sell its South Korean business, Mitsui Sumitomo Insurance seeking UK’s Amlin, and Zurich Insurance after RBS is helping buoy the currency pair. The pound currently trades sub 1.5400.
Commodity currencies update: Commodity currencies in yesterday’s trading rallied in usion. The Aussie rallied in yesterday’s trading session, up 100+ pips in yesterday’s trading day, with spot now testing resistance at 0.7050. The Kiwi faced a similar day of upward gains yesterday, establishing a swing low at 0.6240, with spot now at 0.6380, trading below resistance at 0.6400. The pair is likely to await the RBNZ rate decision (22:00 BST), with the bank expected to cut rates by 25bps. The Canadian dollar has also gained in yesterday’s trading, with the USDCAD pair falling 100+ pips from yesterday’s open. The pair remains largely rangebound with topside resistance set at 1.3300, and the lower bound of the range sitting at 1.3160. Like the Kiwi, the Canadian dollar is likely to wait for the Bank of Canada’s rate announcement, of which rates are expected to be held steady.
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