Afternoon Forex Overview

Previous session overview

The dollar remained lower against the euro and yen Friday after U.S. personal income and spending data were relatively in-line with expectations.

Personal income grew by 0.4% in April, which matched expectations. Personal spending also grew at 0.4% last month, just below the 0.5% growth forecast.

The dollar remains sharply lower against the euro and hit a record low against the Swiss franc earlier in the day as traders avoid the greenback amid worries about slowing growth in the U.S.

The euro was at USD1.4286 from about USD1.4145 late Thursday. The dollar was at JPY81.15 from about JPY81.29.

The dollar has fallen to CHF0.8580 from CHF0.8656 while the euro drops to CHF1.2209 from CHF1.2242.

The Canadian dollar was stronger early Friday, after grinding higher overnight, against a general softness in the U.S. dollar.

The U.S. dollar maintained its weakness against major currencies, but had little movement against the Canadian dollar after data showed that U.S. consumer spending slowed in April, rising 0.4%, trailing expectations of a 0.5% rise. The U.S. dollar was lower Friday morning, at CAD0.9773, from CAD0.9785 late Thursday.

Market expectation

For EURUSD on the upside, above USD1.4300 day high, next resistance level lies at USD1.4350 (May 23/20 highs) and USD1.4425/40 (May 9/11 highs). On the downside, immediate support lies at USD1.4185/00 (May 26 high/day low), and below here, USD1.4065 (May 26 low) and USD1.400/10 (psychological level/May 25 low).A sustained close above USD1.4282 will open the path for further recovery to USD1.4490, say dealers.

For GBPUSD on the upside, above USD1.6460/64 (day highs), the pair might find resistance atUSD1.6515 (May 11 high) and USD1.6575 (May 4 high). On the downside, support levels lie at USD1.6380/00 (day lows), and below here, USD1.6335 (intra-day support) and USD1.6260/70 (intra-day level/May 26 low). Pound's recovery is likely to extend next week according to technical analysts.