Financial Market Research and Analysis

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Brexit fears weigh on GBP
After a very quiet Asian session, the EURUSD dropped 80 pips to 1.1215, following the new Brexit polls from the UK. The pair broke the 100-day moving average on the downside. The next support is seen at 1.1200 (major Fibonacci retracement). In case the EURUSD surpasses 1.1235 (100-day moving average) to the upside, we could see a new appreciation to 1.1298/1300, the 50-day moving average.

The appreciation in the yen concerns the BoJ's Governor Kuroda ahead of Thursday s monetary policy meeting. The USDJPY could test the critical support at 105.54 (May 2nd low). Below this level, we expect acceleration to the downside with mid-term target seen at 100.00 mark. A recovery to 108.70 (50-day moving average) is possible if 107.90 (June 6th high) is surpassed.

Four new polls showing the Brexit in advantage ahead of the 23rd June vote, triggered a further sell-off in the GBPUSD. Cable dropped by 0.8% at 1.4120. The implied volatility for one-month options climbed to nearly 30%, more than three times the level at the end of last year. The critical support is seen at 1.4055 (Fibonacci retracement). Below this level comma Cable could further fall to 1.3834 (Feb 28th low). A rise above 1.4190 (major Fibonacci retracement), could be the start of a short-term inversion with next resistance 1.4300/1.4330. (100-day moving average).

Asian markets are down for a third day in a row, and the limited risk appetite seems to slow down the upside move in the AUD started at the end of May. The AUDUSD finds resistance at 0.7411 (50-day moving average). If the support 0.7326 doesn’t hold comma we might have a short term inversion to the downside with next support seen at 0.7285 (200-day moving average).

After four days of positive candles, a slide to 1280 could be a reaction to a stronger US dollar across the board. The Gold critical resistance is eyed at 1305, the critical support at 1243.

WTI slid for a fourth session, down to 48.05$ a barrel. The OPEC reported that the excess supply in the market is likely to ease over the coming quarters, giving hope for a more balanced oil market toward the end of the year.

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