Intraday Forex Friday, June 18 (EURUSD, USDJPY, etc.) Dollar surges high on Fed rate-hike projection.


Hi everyone. This observation is made around 5:30 UTC today, with 30 minutes time frames. The Resistance and Support Line were constructed according to Fibonacci retrenchment. Any discussion is welcomed.

Shares were mixed on Friday and were set for a weekly loss as worries about inflation and higher rates weighed on the broader market.
Oil falls from multi-year highs to end the week flat.
Gold rose but on track for a more than 5% weekly loss.

Meanwhile, the dollar is headed for its best week since September, following the hawkish outcome from Fed officials.
Traders continued to digest comments from the FOMC meeting projecting interest rate hikes in 2023 and end to emergency bond-buying sooner than expected.
The Fed’s indications also bruised some other market assets as traders feared this could give regional central banks impetus to follow suit, which could cycle cash out of those markets.

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  • The euro gained 0.08% to 1.19148, to sit just above a 2-month low at $1.18918.​
  • The pair stabilised on Friday and did not show much enthusiasm for bouncing back, with moves only slight.​
  • A jump in the 10-year German bund yield to a 3-week high Thursday improves the euro’s interest rate differentials. The upward revision to Eurozone May core CPI to +1.0% from the previously reported +0.9%, also was hawkish for ECB policy.​
  • However, comments from ECB chief economist who Lane said it's unnecessary and premature to talk about tapering of ECB bond purchases weight on the euro. EUR/USD also weighed after Thursday’s data showed Eurozone Apr construction output fell the biggest decline in 7 months.​
  • The dollar meanwhile holding to the carry-over support from Wednesday on a hawkish FOMC.​
Important Levels to Watch for:​
  • Resistance line of 1.20082 and 1.20526.​
  • Support line of 1.18645 and 1.18200.​

  • The dollar was flat on Friday against the yen, at 110.230 after hitting an 11-week peak of 110.82 on Thursday.​
  • The dollar is on track for a 0.5% rise against the yen.​
  • A surge in the 10-year T-note yield undercut the yen, as the greenback had support from Wednesday when the FOMC brought forward its rate-hike forecast.​
  • However, the yen holding the losses in place as the weight of emergency curbs eased in Japan. The PM Suga announced that authorities were lifting a state of emergency for Tokyo and eight other places, though several other prefectures still maintain. The curb set to expire on Sunday.​
  • However, the condition still watched as fears that next month's Olympics could trigger infections rebound.​
  • In the Bank of Japan two-day meeting, the central bank decides to keep rate targets unchanged, and extends Sept deadline for pandemic-relief programme. The BoJ also to launch a new scheme to encourage financial institutions to boost lending and investment for fighting climate change, in a surprise move underscoring the growing attention central banks are putting on the topic.​
Important Levels to Watch for Today:​
  • Resistance line of 110.855 and 111.120.​
  • Support line of 109.997 and 109.732.​

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