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A note on lower timeframe confirming price action...

Waiting for lower timeframe confirmation is our main tool to confirm strength within higher timeframe zones, and has really been the key to our trading success. It takes a little time to understand the subtle nuances, however, as each trade is never the same, but once you master the rhythm so to speak, you will be saved from countless unnecessary losing trades. The following is a list of what we look for:

• A break/retest of supply or demand dependent on which way you're trading.
• A trendline break/retest.
• Buying/selling tails ... essentially we look for a cluster of very obvious spikes off of lower timeframe support and resistance levels within the higher timeframe zone.
• Candlestick patterns. We tend to only stick with pin bars and engulfing bars as these have proven to be the most effective.

We typically search for lower-timeframe confirmation between the M15 and H1 timeframes, since most of our higher-timeframe areas begin with the H4. Stops are usually placed 1-3 pips beyond confirming structures.

EUR/USD

In response to ECB President Mario Draghi's comments yesterday, the EUR shifted northbound and swallowed June's opening level at 1.1238. The dollar continued to sink throughout both the London and US sessions, despite US consumer confidence coming in higher than expected. The day ended with the single currency topping just ahead of the H4 mid-level resistance at 1.1350.

Over on the daily chart, the recent bout of buying also saw price trade through a resistance area coming in at 1.1327-1.1253, consequently opening up the path north to a daily Quasimodo resistance level seen at 1.1382. Weekly action on the other hand remains trading within the walls of a major weekly supply at 1.1533-1.1278.

Our suggestions: Quite simply, the main interest today is the daily Quasimodo resistance at 1.1382. Not only is the level fresh, it's also positioned within the weekly supply mentioned above and is located just below a daily AB=CD 161.8% ext. at 1.1409 and the psychological band 1.14. Given this, a short from 1.1382, with stops placed above 1.1409, is certainly an option today.

Data points to consider: ECB President Mario Draghi speaks at 2.30pm. US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: 1.1382 (stop loss: 1.1415).

GBP/USD

In a similar fashion to the EUR/USD the GBP/USD also went on the offensive yesterday. Chomping its way through the H4 mid-level resistance at 1.2750 and 1.28 handle, the unit ended the day crossing swords with 1.2869/1.2850 (June's opening level/mid-level resistance – green area).

Daily supply at 1.2818-1.2752, thanks to yesterday's advance, suffered a rather aggressive whipsaw. A truckload of stop-loss orders have likely been triggered here, possibly clearing the path north up to daily supply drawn from 1.3058-1.2979. However, to prove genuine consumption here, we would require a daily close to take shape beyond this area.

Our suggestions: Entering long from the 1.28 handle today is not something we'd recommend, as it's difficult to know if the current daily supply is truly consumed. A H4 decisive close below 1.28 may signal buyer weakness, but is not a move we would consider trying to sell. Therefore, our desk will remain on the sidelines for the time being and reassess price action going into tomorrow's open.

Data points to consider: BoE Gov. Carney speaks at 2.30pm. US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

AUD/USD

Failing to sustain gains beyond the 0.76 handle, the commodity currency concluded yesterday's trade relatively unchanged. Consequent to this, a bearish daily selling wick took shape and could potentially send the unit south to retest the daily support area drawn from 0.7556-0.7523. Weekly price, as you can see, remains consolidating within the walls of supply coming in at 0.7610-0.7543.

Similar to Tuesday's report, between 0.76 and the H4 support area at 0.7571-0.7557 (located just above the aforementioned daily support area), we have thirty pips of room to play with. While this is enough to profit if one is able to pin down a tight stop loss, it is not something we will be looking into.

Beyond 0.76 we see April's opening level at 0.7632, a line that happens to be positioned eight pips below the underside of a daily supply area at 0.7679-0.7640. Below the current H4 support area, there's not much room for price to stretch its legs. Close by is a H4 Quasimodo support at 0.7543, followed by H4 support at 0.7524. As is evident from the H4 timeframe, the unit remains restricted as far as structure is concerned.

Our suggestions: On account of the above, neither a long nor short seems attractive at this time. With that being the case, our team, once again, intends to watch today's action from the safety of the bench and will look to reassess price action going into tomorrow's open.

Data points to consider: US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

USD/JPY

For those who read Tuesday's report you may recall that our desk underscored the 112 handle as a particularly interesting level to short from. This was due to 112 merging with a left shoulder i.e. a H4 Quasimodo pattern at 112.05, and also being sited within a daily resistance area at 111.35-112.37 as well as converging closely with a H4 AB=CD 127.2% ext. at 112.09 taken from the low 110.64. As you can see, price responded beautifully to 112 and dropped to a low of 111.46, before reversing into the London open. Well done to any of our readers who managed to jump aboard here.

With weekly price showing room to advance up to supply pegged at 115.50-113.85, in the shape of a weekly AB=CD correction (see pink arrows), and daily flow teasing the upper edge of the said daily resistance area, selling is not something we are keen on.

Our suggestions: Although we are not keen sellers right now, buying from the 112 neighborhood without any H4 confluence present is also not a trade we could be confident in unfortunately. As such, our team is reluctant to commit to this market today.

Data points to consider: BoJ Gov. Kuroda speaks at 2.30pm. US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: Flat (stop loss: N/A).

USD/CAD

As anticipated, the H4 ascending channel formation (1.3165/1.3308) gave way during yesterday's sessions. This was something we mentioned in past reports, and the reason we believed this to be the case was not only did we have daily resistance at 1.3272 in play, but let's also not forget that the current weekly demand was also hanging on by a thin thread.

In seeing that H4 price breached the 1.32 handle, our desk is predominantly bearish right now. The reason for this, other than the recent break of 1.32, is simply due to daily support at 1.3212 also being engulfed. Technically speaking, this has possibly cleared the path south down to a daily demand area coming in at 1.3050-1.3103, which happens to be positioned within the walls of a weekly demand at 1.3006-1.3115/weekly trendline support extended from the high 1.1278 (the next downside target on the weekly timeframe).

Our suggestions: We mentioned in yesterday's report that should 1.32 be consumed and retested as resistance, we would consider shorting this market and targeting the top edge of the weekly demand at 1.3115. Well, given the recent bearish rejection seen from the underside of 1.32, we have decided to sell at market from 1.3171, with a stop positioned at 1.3205 (34pips). Now, the distance to the take-profit is 56 pips, so there's at least one and a half times the risk to be had here.

Data points to consider: US Pending home sales at 3pm, followed closely by Crude oil inventories at 3.30pm. BoC Gov. Poloz speaks at 2.30pm GMT+1.

Levels to watch/live orders:

• Buys: Flat (Stop loss: N/A).
• Sells: 1.3171 ([live] stop loss: 1.3205).

USD/CHF

Beginning with the weekly timeframe this morning, we can clearly see that price is now trading within shouting distance of a weekly support level coming in at 0.9581. Looking down to the daily timeframe on the other hand, support does not come into view until we reach 0.9546.

Over on the H4 timeframe, however, the 0.96 handle is currently seeing some action, following yesterday's rather one-sided move south. With the bulls failing to print anything of note from 0.96 as of yet, this could lead to a break of this level. Be that as it may, trying to short this move could end in tears since let's remember that only 20 pips below sits weekly support at 0.9581, and 35 pips below that is daily support at 0.9546.

Our suggestions: With stop-loss orders below 0.96 just begging to be filled, along with breakout sellers' orders (this will likely provide liquidity for the big boys to buy), we believe a long trade from between 0.9546/0.9581 is high probability today. To be on the safe side, we would only consider a buy from here in the event that a H4 bullish engulfing candle takes shape. This will, for us, confirm buyer intent.

Data points to consider: US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: 0.9546/0.9581 ([waiting for a reasonably sized H4 bull candle to form – preferably a full-bodied candle – following the retest is advised] stop loss: ideally beyond the candle's tail).
• Sells: Flat (stop loss: N/A).

DOW 30

The H4 demand at 21306-21363 is now seen under pressure, following yesterday's selloff. For those who follow our analysis on a regular basis, you may recall that our desk is currently long from 21164. 50% of that position was quickly liquidated at 21234, with the remaining 50% left in the market to run since we intend on trailing this trend long term. Therefore, recent price action is particularly concerning for us considering that we have a stop-loss order located just beneath this zone!

Should the current H4 demand base be taken out, it is likely that the unit will challenge H4 support pegged at 21268, which happens to be located just above daily demand fixed at 21192-21254. For that reason, looking to sell the breakout beneath the said H4 demand is not something we would recommend.

Our suggestions: At the time of writing, there is not much else to hang our hat on. Of course, we would like to see the aforementioned H4 demand stabilize price, but judging H4 price action right now, it's likely to punch lower today.

If that's the case, why not then look for longs from the 21268 neighborhood? Personally, entering into a buy position just beneath a broken demand base, which could act as a resistance area, is too much of a risk in this situation.

Data points to consider: US Pending home sales at 3pm GMT+1.

Levels to watch/live orders:

• Buys: 21164 ([live] stop loss: 21298).
• Sells: Flat (stop loss: N/A).

GOLD

Looking at this market from the top this morning shows that weekly price is on course to print yet another buying tail, just ahead of weekly demand coming in at 1194.8-1229.1. What's also interesting is that daily action is seen retesting a resistance area at 1247.7-1258.8.

Jumping across to the H4 timeframe, we can see that the bulls have found a temporary home above April's opening level at 1248.0. Continual buying here could see the H4 candles connect with the green H4 area which we deem to be a sell zone. The reasons as to why are as follows:

H4 resistance at 1259.1.

Two H4 trendline resistances taken from lows of 1245.9/1252.9.

H4 50.0% retracement value at 1258.1 taken from the high 1281.1.

Located within the upper limits of a daily resistance area at 1247.7-1258.8.

Our suggestions: H4 price is likely to test the above noted green H4 sell zone today. However, with little weekly connection seen around this area, there's a chance that a fakeout could take shape. Therefore, we will only consider a sell from here valid if, and only if, a H4 bearish candle forms, preferably a full-bodied candle.

Levels to watch/live orders:

• Buys: Flat (stop loss: N/A).
• Sells: 1259.1 region ([waiting for a reasonably sized H4 bear candle – preferably a full-bodied candle – to form before pulling the trigger is advised] stop loss: ideally beyond the candle's wick).

US Session Highlights

(US) APR S&P / CASE-SHILLER 20-CITY M/M: 0.28% V 0.50%E; Y/Y: 5.67% V 5.90%E; HOUSE PRICE INDEX (HPI): 197.19 V 195.38 PRIOR

(US) JUN RICHMOND FED MANUFACTURING INDEX: 7 V 5E

(US) JUNE DALLAS FED MANUFACTURING ACTIVITY: 15.0 V 16.0E; new orders 6 v 0 prior

(US) JUN CONSUMER CONFIDENCE: 118.9 V 116.0E

(US) FDA to take new steps to improve prescription drug competition; to expedite review of generic drug applications

(CN) Trump administration reportedly mulling tougher stance on China trade which could include steel tariffs - press

(US) Fed's Harker (hawk, voter) still supports one more rate hike this year; inflation weakness likely temporary

(US) Sen Cornyn (R-TX): Senate will vote on healthcare bill this week; expects to have support to get it done

Stocks fell across the board today, with technology showing the largest losses, as the Nasdaq dropped 1.6%. The S&P was not far behind; it had its lowest close in 6 weeks. Investors have begun to take note of the downward movement, as the VIX increased 10% to 11.06, its highest close in 2 weeks. Financials rose 0.5% on the day, the only sector posting gains.

US markets on close: Dow -0.5%, S&P500 -0.8%, Nasdaq -1.6%

Best Sector in S&P500: Financials

Worst Sector in S&P500: Technology

Biggest gainers: SIG +4.6%; DRI +2.9%; CHK +2.8%

Biggest losers: ARNC -9.0%; STX -6.8%; NFLX -4.1%

At the close: VIX 11.1 (+1.2pts); Treasuries: 2-yr 1.37% (+1bps), 10-yr 2.20% (+6bps), 30-yr 2.74% (+4bps)

Politics

(US) President Trump: I just finished a great meeting with the Republican Senators concerning HealthCare. They really want to get it right, unlike OCare! - tweet

(VE) Venezuela President Maduro: Supreme Court building in Caracas suffered a "terror attack" by police helicopter - press

(JP) Japan chief cabinet secretary Suga: Defense Min Inada will continue to perform his duties; Remarks were reported to PM Abe, have no impact on timing of cabinet reshuffle - press

Key economic data

none seen

Asia Session Observations

Sentiment has turned more cautious as investors sold both Equities and Treasuries in US session, while the Vix jumped above 11. Euro spiked up over 1 big figure overnight on much less dovish comments from ECB President Draghi. USD/JPY is pulling back to 112 handle after rising above 112.40, while Nikkei225 has reversed its opening gains.

Takata briefly resumed trading, plunging over 40%; Toshiba is also struggling to close its chip unit sale on resistance from WDC.

Speakers and Press

China

(CN) PBoC adviser: Anticipates no further tightening of monetary policy in H2 - Chinese press

(CN) Bank of China (BOC) economists see China 2017 GDP around 6.8% - press

(CN) China Beige Book International (CBB) Q2 survey: Economy continues to improve

(CN) China Academy of Social Sciences (CASS): Q2 GDP estimated at 6.8% v 6.9% in Q1; 2017 GDP seen around 6.7% v around 6.5% official target - Chinese press

Japan

(JP) Japan PM Abe reportedly considering abandoning plans to balance the budget by FY20 in exchange for looser debt-to-GDP ratio target - press

(JP) Japan top banks sold off their JGB holdings to lowest level on record - Nikkei

Australia / New Zealand

(AU) Former RBA board member Edwards: RBA may raise interest rates as many as 8 times in 2018-19 - AFR

(NZ) According to latest RBNZ data, property investors borrowing in May fell to NZ$1.5B from NZ$2.5B y/y

(NZ) RBNZ Gov Wheeler: Outlook for growth remains positive - statement of intent outlining priorities

Korea

(CN) China National Petroleum Corporation (CNPC) suspends fuel sales to North Korea over concerns that it won’t get paid

Asian Equity Indices/Futures (00:00ET)

Nikkei -0.3%, Hang Seng -0.4%, Shanghai Composite +0.1%, ASX200 +0.3%, Kospi -0.2%

Equity Futures: S&P500 -0.1%; Nasdaq -0.3%, Dax flat, FTSE100 +0.1%

FX ranges/Commodities/Fixed Income (00:00ET)

EUR 1.1330-1.1355; JPY 112.05-112.35; AUD 0.7580-0.7615; NZD 0.7260-0.7285

Aug Gold +0.5% at 1,253/oz; Aug Crude Oil -0.2% at $44.14/brl; Sept Copper +0.2% at $2.66/lb

(US) Weekly API Oil Inventories: Crude: +0.9M v -2.7M prior

(CN) PBOC SETS YUAN MID POINT AT 6.8053 V 6.8292 PRIOR; strongest Yuan fix since June 19th

(CN) PBoC: To skip today's open market operation (OMO); 4th consecutive skip

(CN) China MOF sells 3-yr bonds at 3.4349% v 3.42%e; bid-to-cover 2.73x

(AU) Australia sells A$800M in 2027 bonds; avg yield 2.4791%; bid-to-cover 3.5x

Asia equities notable movers

Australia

Sirtex Medical (SRX) +14.9%; To cut staff by 15%; to write off A$90M in R&D, performing within FY17 guidance

Nine Entertainment (NEC) +6.1%; Raises FY17 Reported EBITDA to A$200-210M; Sees FY17 reduction in the licensing fees that it has to pay, equal to ~A$33M (guided A$158-187M on May 2nd)

AusNet Services (AST) +2.5%; Raised at Credit Suisse

Japan

FujiFilm (4901) -1.1%; Files to delay financial results to July 31st

Toshiba (6502) -1.2%; CEO: Western Digital is unfairly obstructing the chip unit sale; Looking to resolve dispute at an early stage

Hong Kong

Yanzhou Coal (1171) +2.6%; Raised at HSBC

Kenford Group holdings (464) -7.1%; Reports FY17 (HK$) Net loss 22.2M v 22.5M y/y; Rev 495.4M v 522.9M y/y

Market movers today

Data on euro area credit and M3 growth are due out today. While we estimate M3 continued to show around 5% yearly growth, we believe loan growth continued its upward trend. In particular, adjusted loans to NFCs increased from 1.9% in February to 2.4% in April. We estimate this increased further in May, as credit demand continued to increase.

ECB president Mario Draghi is due to participate in a Policy Panel at 15:30 CET at the ECB Forum on central banking in Portugal. The Fed's Williams is due to speak at 9:30 CET but the speech will be a reprise of the speech held yesterday.

Italy will be the first euro country to release HICP inflation for June. Consensus estimates a decline to 1.4% y/y from 1.6% y/y in May. Tomorrow, Germany and Spain are due to release inflation data, followed by the flash estimate for the euro area on Friday.

Data on the US trade balance and pending home sales are due for release.

Selected market news

Yesterday, EUR crosses soared and the German 10-year government benchmark bond sold off. The yield climbed some 5bp initially, following some hawkish comments from ECB President Mario Draghi. In a speech in Portugal, Draghi said, ‘as the economy continues to recover, a constant policy stance will become more accommodative and the central bank can accompany the recovery by adjusting parameters of its policy instrument – not in order to tighten the policy stance, but to keep it broadly unchanged' . Additionally, he said that ‘all the signs now point to a strengthening and broadening recovery in the euro area – deflationary forces have been replaced by reflationary ones'. Despite the hawkish comments, Draghi concluded that ‘a considerable degree of monetary accommodation is still needed for inflation dynamics to become durable and self-sustaining' (for more see Bloomberg, 27 June 2017). As the ECB, in our view, is currently too optimistic on wages and core inflation, we stick to our view that it will extend its QE purchases and continue its monthly purchases at EUR40bn per month in H1 18.

In the UK, the Bank of England (BoE) is set to ‘reduce' some of its stimuli by raising the countercyclical capital buffer to 0.5% and plans to increase the level to 1% in November 2018. According to the BoE's Financial Stability Report , each 0.5pp increase will swell the bank's cushion of common equity Tier 1 by GBP 5.7bn .

In the US, the Senate Republicans postponed a vote on the healthcare bill yesterday after resistance from members of their own party. According to conservative Republicans, the Senate bill does not do enough to erase Obamacare, whereas moderate Republicans are worried that millions of people will lose their insurance. The House of Representatives has passed its own version of the healthcare bill last month .

Yesterday in London, Fed Chair Janet Yellen reiterated that the Fed's balance sheet is set to be shrunk ‘gradually and predictably' and that the Fed intends to raise interest rates only gradually

Global Markets:

• Asian stock markets: Nikkei down 0.35 %, Shanghai Composite gained 0.05 %, Hang Seng fell 0.30 %, ASX 200 rose 0.40 %
• Commodities: Gold at $1253 (+0.50 %), Silver at $16.80 (+1.25 %), WTI Oil at $44.15 (-0.25 %), Brent Oil at $46.90 (+0.05 %)
• Rates: US 10-year yield at 2.20, UK 10-year yield at 1.09, German 10-year yield at 0.37

News & Data

• PBoC Sets CNY/USD Mid-Point Fix At 6.8053 Vs Prev 6.8292 and Last Close 6.8145
• RBNZ: Outlook for Econ Growth Positive, But Considerable Uncertainties
• Financial System Sound, Key Domestic Risk Is Housing Market
• Fed's Yellen: We Believe Appropriate to Raise Rates Gradually
• Fed's Yellen: Even Though Jobless Rate Low, Below Level Colleagues See as Sustainable, Inflation Has Continued to Run Below Our Objectives
• Asia stocks pressured as Wall St. hit by healthcare vote delay – RTRS

Markets Update:

The Euro rallied after hawkish comments from ECB President Draghi. EUR/USD reached a high of 1.1355 in Asia. While it looks a bit overbought in the short-term, the pair is likely to find good support around 1.1300. Overall, further gains seem likely, with 1.1450 now the next notable resistance level.

GBP/USD recovered as well, although it has not been able to gather the same momentum as EUR/USD. The pair reached a high of 1.2825 in Asia. The break above 1.2810 resistance suggests GBP/USD could test 1.2970 soon. However, the topside is likely to be capped ahead of 1.30 amid on-going political uncertainty in the UK.

USD/JPY traded 112.05-35 overnight. The tech outlook remains positive, but broad USD weakness could weigh on the pair as well. Key support is seen at 111.50, while resistance lies ahead of 113.

USD/CAD broke below a key support level overnight, and it is likely that it will move towards 1.30 in the coming days. While falling oil prices would usually be bearish for the Canadian Dollar, it didn't have much of an impact in the last few trading weeks.

The main event today will be US crude oil inventories data. If the increase in inventory is larger than expected, WTI is likely to test 42.00 soon.

Upcoming Events:

• 07:45 BST – French Consumer Confidence
• 10:00 BST – Italian CPI
• 15:00 BST – US Pending Home Sales
• 15:30 BST – US Crude Oil Inventories

For the 24 hours to 23:00 GMT, the AUD rose 0.08% against the USD and closed at 0.7588.

LME Copper prices rose 0.3% or $18.0/MT to $5789.0/MT. Aluminium prices rose 0.4% or $6.5/MT to $1861.5/MT.

In the Asian session, at GMT0300, the pair is trading at 0.7604, with the AUD trading 0.21% higher against the USD from yesterday's close. The pair is expected to find support at 0.7579, and a fall through could take it to the next support level of 0.7555.

The pair is expected to find its first resistance at 0.7626, and a rise through could take it to the next resistance level of 0.7649.

Going ahead, Australia's HIA new home sales data for May, set to release in the early hours of tomorrow, will garner market attention.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the EUR rose 1.44% against the USD and closed at 1.1341, following hawkish remarks from the European Central Bank (ECB) President, Mario Draghi.

The ECB Chief signalled that the central bank could scale back its stimulus efforts if the economy continues to be on the strong recovery path, but added that any such move would be gradual. However, Draghi noted that the Euro-bloc still requires a substantial monetary stimulus to bring a durable and self-sustaining rise in inflation.

On the macro front, Italy's consumer confidence index rose more-than-expected to a level of 106.4 in June, compared to market expectations of a rise to a level of 105.8. In the previous month, the index had registered a level of 105.4.

The greenback lost ground against a basket of major currencies, after a vote on healthcare legislation was delayed in the US Senate, casting doubt on the ability of the US President, Donald Trump to implement his agenda of tax reform and infrastructure spending.

On the macro front, the US CB consumer confidence index unexpectedly advanced to a level of 118.9 in June, propelled by a buoyant labour market and improved business conditions. The index had registered a revised reading of 117.6 in the previous month, compared to market expectations of a fall to a level of 116.0.

Separately, the International Monetary Fund (IMF) downgraded its growth forecast for the US economy to 2.1% in 2017, down from 2.3% estimated in April, as promises made by the US President regarding fiscal policy, tax cuts and deregulation look less likely to be implemented. Further, the organisation trimmed growth for next year and warned that the economy would have a hard time achieving the 3.0% growth target set in the President's first budget.

Meanwhile, the Philadelphia Federal Reserve (Fed) President, Patrick Harker, London, reaffirmed his stance for raising interest rate one more time this year. However, he warned that Fed may have to rethink on its monetary policy trajectory if inflation continues to abate.

In the Asian session, at GMT0300, the pair is trading at 1.135, with the EUR trading 0.08% higher against the USD from yesterday's close.

The pair is expected to find support at 1.1235, and a fall through could take it to the next support level of 1.1121. The pair is expected to find its first resistance at 1.1410, and a rise through could take it to the next resistance level of 1.1471.

In absence of any crucial economic releases in the Euro-zone today, investors will await the release of the US advance goods trade balance, flash wholesale inventories and pending home sales data, all for May, scheduled to release later in the day.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the GBP rose 0.79% against the USD and closed at 1.2819.

Yesterday, the Bank of England, in its bi-annual Financial Stability Report, warned of possible threats of a 'hard Brexit' on the UK economy and has called British banks to increase their capital requirements to prepare for the uncertain outcome of Brexit talks.

In the Asian session, at GMT0300, the pair is trading at 1.2818, with the GBP trading marginally lower against the USD from yesterday's close.

The pair is expected to find support at 1.2736, and a fall through could take it to the next support level of 1.2655. The pair is expected to find its first resistance at 1.288, and a rise through could take it to the next resistance level of 1.2943.

Moving ahead, investors will look forward to the UK's nationwide house prices data, slated to release in a few hours.

The currency pair is trading above its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD rose 0.3% against the JPY and closed at 112.21.

In the Asian session, at GMT0300, the pair is trading at 112.10, with the USD trading 0.1% lower against the JPY from yesterday’s close.

The pair is expected to find support at 111.55, and a fall through could take it to the next support level of 111.00. The pair is expected to find its first resistance at 112.56, and a rise through could take it to the next resistance level of 113.02.

Looking ahead, market participants will keep a close watch on Japan’s retail trade and large retailers’ sales, both for May, set to release overnight.

The currency pair is showing convergence with its 20 Hr moving average and trading above its 50 Hr moving average.

For the 24 hours to 23:00 GMT, the USD declined 1.29% against the CHF and closed at 0.9600.

In the Asian session, at GMT0300, the pair is trading at 0.9598, with the USD trading slightly lower against the CHF from yesterday's close.

The pair is expected to find support at 0.9549, and a fall through could take it to the next support level of 0.95. The pair is expected to find its first resistance at 0.969, and a rise through could take it to the next resistance level of 0.9782.

Looking ahead, Switzerland's ZEW expectations index for June and UBS consumption indicator data for May, scheduled to release in a few hours, will be on investors' radar.

The currency pair is trading below its 20 Hr and 50 Hr moving averages.

For the 24 hours to 23:00 GMT, the USD declined 0.62% against the CAD and closed at 1.3174.

In the Asian session, at GMT0300, the pair is trading at 1.3148, with the USD trading 0.2% lower against the CAD from yesterday's close.

The pair is expected to find support at 1.3104, and a fall through could take it to the next support level of 1.3061. The pair is expected to find its first resistance at 1.3226, and a rise through could take it to the next resistance level of 1.3305.

Ahead in the day, all eyes will be on a speech by the Bank of Canada's Governor, Stephen Poloz. The currency pair is trading below its 20 Hr and 50 Hr moving averages.