There is no impetus for bigger forex moves on Wednesday, with no data on tap from major economies during the European session. However, the Bank of England releases the minutes of its last monetary policy board meeting at 4:30 am ET, which is likely to be scrutinized by the market in a bid to glean clues about the future course of interest rates. Shortly thereafter, the euro-zone industrial new orders data for March is scheduled to be released, which is expected to show an improvement in the month.
US treasury secretary Paulson meets with his Chinese counterparts for the second day on Wednesday. Investors may focus on the outcome of meeting, as pressure from the U.S. to implement economic reforms can lead to a rift and cause a ripple in the currency market.
The euro moved sideways against the dollar in the evening trading on Tuesday in New York, but the pair edged up to 1.3461 amid the Japanese release at 7:50 pm. The gains were soon given back by the euro, but later, the pair spiked again. After hitting as high as 1.3463, the pair shed a few pips and as of 1:40 am ET on Wednesday, the euro was equal to 1.3459 dollars. Broadly speaking, the pair has been trending down from 27th April, and if moved further deeper, it is likely to test new long term support levels around 1.326.
The euro rallied against the Japanese unit in late trading on Tuesday in New York. Rising from 163.44 at 6:30 pm ET, the pair fetched as high as 163.76, before reversing its direction within about an hour. However, around a couple hours before midnight, the euro staged another spike, and the pair collected 163.84, shortly. Lately, the euro dropped a few pips, and the pair was quoted at 163.74 by about 1:40 am ET on Wednesday. The present trend is likely to lead the pair to a near term resistance level around 163.9, which is slightly below the 164.5 level, hit in October 1998.
The euro strengthened against the pound during late trading on Tuesday in New York. Gaining ground at about 5:10 pm ET, the pair moved from 0.6809 and fetched 0.6819 by about 10:50 pm ET. Within about an hour of that, the pair drifted a pip lower, and it has been moving range-bound below that level, lately. On Tuesday, the euro was t loss against the cable, which confirmed the downward journey started by the pair on 16th of this month. A likely near term level of support for the pair will be around 0.678 which was lastly hit on 10th May.
The European currency saw choppy trading versus the Swiss franc during late New York trading on Tuesday. Initial gains by the common currency resulted in the pair fetching as much as 1.6551, but it fell sharply, shortly. However, gaining ground within about an hour, the pair reached a tight range that limited between 1.6538 and 1.6548 and as been holding the same range, lately. Largely, the pair was at loss on Tuesday, which showed that the euro has started correction its gains in the previous week. For a pair weakening further, the likely near term level of support will be around 1.641.
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