•Wall Street opens higher on improving market sentiment.
•US Dollar Index refreshes weekly high above mid-94s.
•SNB’s Quarterly Bulletin doesn’t offer anything new.
After closing the previous day around 40 pips higher, the pair was able to build on its bullish momentum on Wednesday fueled by higher risk appetite and a stronger greenback. As of writing, the pair was trading at 0.9950, adding 0.4% on the day.
Earlier in the day, senior Trump administration officials stated that President Trump decided against harsh measures on Chinese investments on the technology companies in the United States and helped the risk aversion lose its dominance over the market action. Major equity indexes in the United States started the day higher and continue to climb with the Dow Jones Industrial Average and the S&P 500 both gaining around 0.5% at the moment. Meanwhile, the US Dollar Index just recently touched its highest level in a week at 94.70.
On the other hand, the Swiss National Bank published its Quarterly Bulletin which highlighted that the bank would remain active in the foreign exchange markets as necessary and added that the new conditional inflation forecast for the coming quarters is slightly higher than it was in March 2018 due to a marked rise in the price of oil.
Later in the session, FOMC member Quarles and the Boston Fed President Rosengren will be delivering speeches. However, the risk perception is likely to continue to drive the pair’s price action.
Technical levels to consider
On the upside, 1.0000 (parity/psychological level) could be seen as the first resistance for the pair ahead of 1.0055 (May 9 high) and 1.0100 (May. 11, 2017, high). On the downside, supports could be seen at 0.9840 (Jun. 13 low), 0.9790 (Jun. 7 low) and 0.9700 (psychological level).