On Tuesday, Australia's Treasury's budget report showed that the deficit was forecast to fall from A$50 billion to A$30 billion, which pushed the Aussie higher. Earlier today, the Australian dollar extended gains and climbed to 1-month high against its U.S. counterpart. In this way, AUD/USD broke above the nearest resistance zone, approaching April high. Whether the situation is as bullish as it looks at the first glance?

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Earlier today, the ZEW Institute showed that its index of German economic sentiment fell to a 16-month low this month. Additionally, the ZEW Institute reported that its economic sentiment index for the entire euro zone also moved down to 55.2 in May, from a reading of 61.2 the previous month. These disappointing numbers pushed the common currency to a 1-month low against the U.S. dollar. In this way, EUR/USD dropped to its downside target, but is it enough to trigger a corrective upswing?

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Although the National Australia Bank reported earlier today that its business confidence index rose to 6 in April (from a reading of 4 in March), the Australian dollar was almost unchanged against its U.S. counterpart. Does this lack of reaction suggest upcoming weakness in AUD/USD?

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Today, the U.S. dollar moved higher against major currencies as ongoing concerns over tensions in Ukraine and upbeat U.S. jobless claims data released yesterday supported the greenback. As a result, EUR/USD declined sharply, breaking below its initial downside targets, while GBP/USD dropped below major medium-term support. Additionally, the Australian dollar slipped under the key resistance zone. Does this show of weakness mean that the worst for the U.S. currency is behind us? Where the major currency pairs head in the coming week?

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Earlier today, the euro moved higher after the European Central Bank left its benchmark interest rate unchanged at the record low of 0.25%. However, an acceleration of the rally came after U.S. Department of Labor showed that initial claims for jobless benefits in the week ending May 3 fell more than expected. Thanks to these disappointing numbers, EUR/USD hit a fresh 2014 high and approached the key level of 1.4000. Despite this improvement, the exchange rate reversed quickly and declined, erasing all earlier gains. Does this sharp drop suggest that the uptrend might be over?

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