Correction complete

The euro is trading 3% lower against the dollar from the close on Friday as the 6 week correction  looks seemingly complete, with the EUR/USD May 11th low of 1.1053 very much in play in early European trading. The latest bout of euro weakness comes from increased political tension in Greece, with reports this morning suggesting that Athens will boycott the IMF repayment on June the 5th unless an agreement is reached with the lenders. The market looks at the market mechanism of ECB member Coeure’s suggestions that the ECB bond purchases could be front-loaded in anticipation of lighter liquidity over the summer months. The dollar is generally trading firmer across the board, as oil slides 3% after the data bucked the below consensus trend of late with a solid housing starts reading.

The FOMC minutes released at 7pm this evening will be scrutinised for the Fed view on the weaker data for Q1, as the attention will then turn to Fed Chair Janet Yellen’s speech at a luncheon on Friday where she will address the Greater Providence Chamber of Commerce Economic Outlook.

The MPC minutes are the highlight of the European session today, where the risks are tilted to a slightly dovish outcome given the recent decline in activity following the election. A 9-0 outcome is the consensus for the May meeting following the inflation report that signalled a lower for longer stance on rates.

EUR/USD
Support 1.1050-1.1036-1.0970 | Resistance 1.1140-1.1250-1.1500

USD/JPY
Support 118.90-118.20-117.50 | Resistance 121.55-122.00-124.60

GBP/USD
Support 1.5290-1.5150-1.5090 | Resistance 1.5550-1.5670-1.5820