The EUR declined by 0.6 percent and so did the Swiss franc

Good morning from beautiful Hamburg and welcome to our latest Daily FX Report. U.S. stocks rose on Tuesday and the S&P notched its best performance in a month after a report shifted investor expectations for the Federal Reserve's policy statement due on Wednesday. Each of the ten major S&P sectors finished in positive territory and the Dow even managed to hit a new intraday record.The Fed began its two-day policy meeting on Tuesday, and while it has said it doesn't expect to raise rates until 2015, recent strong economic data has led Fed officials to acknowledge they may need to move sooner than they previously anticipated.

Anyway, we wish you a successful trading day!

Market Review – Fundamental Perspective

Over the course of the last four weeks, the USD was able to gain more than 3 percent compared to a basket of 10 developed-nation currencies tracked by the Bloomberg Correlation-Weighted Indexes and is the best performer. Due to the speculation the Federal Reserve will maintain a pledge to keep interest rates low for a “considerable time” in its policy statement today, the USD fell the most against its major peers in four months. It declined 0.2 percent to $1.2960 per euro and was little changed at 107.13 yen. According to the index, the yen fell 2 percent and is the biggest loser. The EUR declined by 0.6 percent and so did the Swiss franc, which lost 0.6 percent as well. Yesterday the franc rose 0.1 percent against the EUR to 1.2086 and thus approached the 1.20 per euro-cap inposed by the Swiss National Bank. This is intensifying speculation the central bank will need to intervene in order to weaken the franc.
Caused by the expected independence referendum, the GBP slumped to its weakest level in about 10 months versus the USD at $1.6052. At this level the currency was able to rebound and appreciated to $1.6187. Although the GBP lost against the EUR, it was at 79.97 pence per euro and therefore stronger than its five-year average of 84.53 pence.
Canadian`s dollar rallied after the nation`s factory sales increased to a record high and gained in value versus all of its 16 major peers. The CAD appreciated by 0.8 percent against the USD to C$1.0970 per U.S. dollar after it depreciated yesterday to the weakest level since March 27. Brent crude rose 1.1 percent to $98.97 per barrel, while U.S. crude futures gained 2 percent at $94.82 per barrel, rising on the prospect of a likely supply cut from OPEC.

Daily Technical Analysis

EUR/GBP (Daily)

After starting an downward movenment in the end of May, the EUR lost in value versust the GBP till the pair reached the support level at 0.7889 where it rebounded. Since then we saw a slightly recovery and a movement between the mentioned support line and the resistance level at 0.8037. At the moment we still can observe a sideward movement between the mentioned levels and the indicators do not provide a clear signal as well.

Support & Resistance (Daily)