Yesterday, the Australian dollar moved higher against its U.S. counterpart after the Federal Reserve indicated that interest rates will remain low for a considerable time after the bank’s asset purchase program ends. Thanks to this news AUD/USD rebounded sharply, invalidating earlier breakdown and breaking above the resistance zone. Will we see further improvement in the near future?

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The minutes of the Bank of England showed that the monetary policy committee voted unanimously to leave interest rates on hold at their record low of 0.5% in June. As a result, the British pound moved lower against the U.S. dollar, declining below yesterday’s low. Will we see further deterioration and a drop to the nearest Fibonacci retracement?

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Earlier today, the Australian dollar declined against its U.S. counterpart after the Reserve Bank of Australia comments. Later in the day, we saw further deterioration as the Labor Department reported that the U.S. CPI rose 2.1% on year in May (and 0.4% from April). This the fastest increase in annual inflation since October 2008 sparked demand for the greenback and pushed AUD/USD below two important support lines. How low could the exchange rate drop from here?

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Earlier today, the Federal Reserve Bank of New York reported that manufacturing activity in the Empire state expanded more quickly than expected this month. Additionally, U.S. industrial production rose by a seasonally adjusted 0.6% last month, beating forecasts for a 0.5% gain. Despite these numbers, the greenback moved lower against the euro as concerns over the conflict in Iraq overweighed this positive news. In this way, the common currency climbed to its important upside target. Will we see a breakout in the near future?

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Today, the U.S. currency moved higher against major currencies after official data showed that U.S. producer price inflation fell 0.2% in May, beating expectations for a 0.1% rise. Core producer price inflation (without food, energy and trade) slipped 0.1% last month, compared to expectations of 0.1% gain. As a result, EUR/USD declined to its major support lines, AUD/USD invalidated the breakout above the resistance zone, while USD/JPY erased all yesterday’s losses. How did these numbers influenced technical picture of other major currency pairs?

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