Strong risk appetite sentiment remains in play and keeps the dollar well supported against its major counterparts. The greenback hit six-week high against yen on Wednesday at 107.47, on extension near-term recovery leg from 100.00 trough.
Dollar’s bulls received strong bullish signal on Wednesday’s close above 106.70, Fibonacci 61.8% retracement of 111.43/99.04 descend.
Investors are awaiting next week’s BoJ meeting, on expectations of easing monetary policy. Polls show 85% of analysts expecting BoJ to ease on July 29 meeting, along with fiscal spending boost that Japanese PM is set to announce this month.
Another Central Bank is in focus today. ECB is having a policy meeting today, facing gathering storm clouds on Brexit impact, but is widely expected to keep rates on hold today. However, the ECB is expected to address the list of obstacles which are growing on the way of central bank’s attempts to revive growth and boost inflation.
Brexit effects that are expected to show more in coming months are on top of the list of problems that ECB needs to handle, along with Italy’s bank troubles and shortage of bonds to buy in its asset purchase programme.
The Euro returned above psychological 1.1000 support against dollar, following Wednesday’s false break lower that was contained at 1.0980. Traders are awaiting ECB’s announcement later today, for hints of their future monetary policy easing.
Sterling regained ground against the euro and broadly stronger dollar on Wednesday’s better-than-expected UK jobs data and BOE’s survey that showed no clear evidence of a slowing of economy, which was expected as immediate reaction on last month Brexit vote.
The pound stays tall against the dollar and approaches important 1.3300 resistance zone.
New Zealand dollar remains among the top losers of this week, extending steep descend to lowest levels in more than six weeks, after RBNZ signaled more rate cuts, saying that the currency needs to weaken further to generate rise in inflation.
Kiwi dipped to 0.6950 low against US dollar on its seventh straight day of descend, eyeing strong technical supports at 0.6920/00 zone.
Another top loser is Turkish lira which hit record low at 3.0967, remaining under strong pressure after last week’s coup attempt and subsequent political turmoil. In addition, rating agency Standard and Poor’s cut Turkey’s foreign credit rating on expected period of heightened unpredictability.
Turkish President Erdogan declared a state of emergency in Turkey, which will last three months and allow his government to take stronger action against supporters of the coup.
Highlights of the day

Europe
UK Retail Sales are expected to fall in June, according to m/m forecast at -0.6% vs 1.0% in May and y/y release forecasted at 5.0% in June, vs 6.0% in May.
Data are due at 08:30 GMT.

ECB’ policy meeting is the event of the day. The central bank is expected to take no action today, leaving interest rates and asset purchase programme unchanged, but expected to hint its near-future steps.
Economists expect the ECB to extend and widen its programme, in order to fight weak economic growth and inflation.
Policy decision announcement is due at 11:45 GMT, while press conference starts at 12:30 GMT.
America
US weekly jobless claims are forecasted to rise in the week behind us, on forecasted 265K vs 254K in previous week.
Data are due at 12:30 GMT.

Important levels

USDTRY
The pair hit new record high and is seen rising further on political uncertainty in the country. Fresh high was posted at 3.0967, just ahead of psychological 3.1000 barrier and projected targets at 3.1245; 3.1500 and 3.1850.
Immediate support lies at 3.0540; followed by 3.0120 and psychological 3.0000 support.
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GBPUSD

The pair extends recovery for the second day, on a bounce from strong supports at 1.3070 zone, where recent dips found solid ground. Fresh gains turned near-term outlook positive and look for extension towards key near-term barrier at 1.3312, break of which would trigger stronger recovery and re-expose key short-term resistances at 1.3480 and 1.3530.
Initial support lies at 1.3200, followed by 1.3142 and 1.3100.
USDJPY
The pair extends near-term recovery leg from 100.00 trough, posting fresh high at107.47. Strong bullish sentiment favors further gains towards next barriers at 108.00 and 108.50.
Immediate support is at 106.73, followed by 106.00/105.80 and 105.20.
Technical studies show overbought conditions and signal possible pause in current gains, in fa=vor of consolidative / corrective action., Market Analysis