The U.S. dollar was seen trading mixed on Monday with a slight risk aversion putting the safe haven yen and the Swiss franc on the front foot. Economic data was relatively light on the day. The markets continue to remain cautiouson escalating trade war rhetoric between the U.S. and its trading partners including China.
The economic calendar for the day is relatively quiet. The ECB president, Mario Draghi is expected to speak for the second day today at the banking conference in Portugal. This is later followed by the Eurozone current account report.
The U.S. trading session will see the release of the building permits data. Economists forecast that building permits increased 1.35 million in the month of May, slightly lower than the 1.36 million seen the month before.
The U.S. housing starts data is also expected during the day.
EURUSD intra-day analysis
EURUSD (1.1641): The EURUSD currency pair was seen trading subdued with price action mostly limited within the range established from Friday. However, early price action in the Asian session is signaling that the currency pair might be inching higher. Still, the main resistance at 1.1730 remains a key level that needs to be breached in order for the euro to target 1.1920 – 1.1955 level. While the bias is slightly shifting to the upside, the 4-hour chart shows the EURUSD posting a bearish flag pattern near the support. A break down below 1.1577 could however signal a continuation to the downside, targeting 1.1394.
USDJPY intra-day analysis
USDJPY (109.84): The USDJPY currency pair was seen posting losses with the markets going easy on risk. Following the break of the rising trend line and the rising wedge pattern, the USDJPY currency is likely to retest the lower support at 109.57 – 109.43. In the near term, any retracement will most likely test the breakout level near the trend line at 110.09. But further gains are likely to be limited at this point.
XAUUSD intra-day analysis
XAUUSD (1280.25): Gold prices were seen drifting below the 1282 handle and price action is showing signs of forming a temporary bottom between 1282 and 1274. The reversal off this level could once again put gold prices to trade within 1301 – 1304 level of resistance while to the downside, the declines are likely to be limited near the 1274 handle. Gold prices are likely to remain in the sideways range for the moment.