Sterling was steady against the dollar on Wednesday, holding above a 2 year low touched a day earlier after data added to signs that a recession may be looming in Britain. Sterling had touched its lowest on Tuesday since March 2020 after the purchasing manager’s index (PMI) data showed growth in Britain’s private sector slowing in August and entered stagnation amid declining consumer demand, staff shortages and instability in the supply of components and energy. According to experts, these reasons will lead to a further slowdown in the sector in the coming months. Immediate support is seen at 1.1800. A breakout below could take the pair towards 1.1700.
SELL STOP 1.1800/TP 1.1700/SL 1.1830
The euro was at a two-decade low on Wednesday as investor sentiment soured under the weight of high energy prices, weak global economic data, and more inflation fears. Renewed concerns that central banks will keep hiking interest rates aggressively to tame red hot inflation were also high on investors’ minds ahead of the closely-watched Jackson Hole central banking symposium which begins on Thursday. Investors are waiting for the results of the US Federal Reserve Chairman Jerome Powell’s speech. The official may point to the need to continue tight monetary policy, which, in particular, involves raising the interest rate by 75 basis points during the September meeting. Immediate support is seen at 0.9950. A breakout below could take the pair towards 0.9850.
SELL STOP 0.9950/TP 0.9850/SL 0.9980
The Canadian dollar weakened against the U.S. dollar on Wednesday as the greenback broadly rallied and domestic data showed wholesale trade falling in July. Canadian wholesale trade likely fell 0.6% in July from June. The data adds to recent evidence showing a cooling of economic growth in the third quarter. The price of oil, one of Canada’s major exports, was up 0.6% at $94 a barrel. Before Powell’s speech on Friday, buyers of the Canadian dollar had an opportunity to strengthen their positions, taking advantage of the support of rising oil prices. It might happen today. Immediate support is seen at 1.2900. A breakout below could take the pair towards 1.2800.
SELL STOP 1.2900/TP 1.2800/SL 1.2930