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EUR/USD, EUR/GBP slide while USD/JPY continues to surge higher

EUR/USD and EUR/GBP continue their descents amid low volatility while USD/JPY’s exponential rally is ongoing with it trading at levels last seen in August 2015.

GBPSource: Bloomberg
 
 Axel Rudolph | Market Analyst, London | Publication date: Monday 28 March 2022 

EUR/USD remains under pressure ahead of busy US data calendar

EUR/USD continues to slide below its two-month downtrend line at $1.1035 towards the mid-March $1.0901 low as investors await US consumer confidence, core PCE price index and employment data and mull the latest developments of the Russia-Ukraine war which last week entered its second month.

A slip through the mid-March $1.0901 low would target the $1.0806 early March low. While the cross remains below the mid-March high at $1.1137, this year’s downtrend remains intact.

EUR/USD chartSource: IT-Finance.com

EUR/GBP trades on weaker footing

Last week EUR/GBP reached but ran out of steam slightly above the 55-day simple moving average (SMA) and 11 March low at £0.837 as UK March consumer confidence and retail sales data came in weaker than expected which pushed the EUR/GBP exchange rate higher.

Since then, it has resumed its descent towards the £0.8305 to £0.8286 region which offered support in January and February and may do so again in the days to come.

Resistance above last week’s high at £0.837 can be found between the 16 February and 25 February highs at £0.8402 to £0.8408.

EUR/GBP chartSource: IT-Finance.com

USD/JPY continues to surge higher

USD/JPY is fast approaching the June 2007 high at ¥124.13, having risen by over +7% since the beginning of March as the Bank of Japan (BoJ) re-iterates its dovish stance despite inflation hitting 3-year highs while traders price in potentially aggressive rate hikes by the US Federal Reserve (FED).

The area around the June 2007 high at ¥124.13 is expected to cap the currency pair in the short term, since the last three weeks’ steep rate of ascent is most likely not sustainable. Were the ¥124.13 high to be exceeded on a daily chart closing basis, however, the June 2015 peak at ¥125.85 would be within reach.

Minor retracements may find support at the 24 March ¥122.43 high and further down between the 22 March high and 25 March low at ¥121.41 to ¥121.18.

USD/JPY chartSource: IT-Finance.com
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EUR/USD awaits data, EUR/GBP close to resistance as AUD/USD stalls

EUR/USD trades in low volatility while EUR/GBP snapped back up but nears technical resistance, just as AUD/USD did before stalling.

 

 

EUR/USD trades sideways in low volatility ahead of US data

EUR/USD continues to range trade in low volatility below its two-month downtrend line at $1.1023 as traders await US consumer confidence, core personal consumption expenditures (PCE) price index and employment data.

A slip through yesterday’s low at $1.0945 would engage the mid-March $1.0901 low. Further down sits the $1.0806 early March low.

Minor resistance above the downtrend line can be spotted at yesterday’s $1.1037 high. While the cross remains below the next higher mid-March high at $1.1137, this year’s downtrend remains intact.

EUR/USD chartSource: IT-Finance.com

EUR/GBP rally approaches resistance zone which may cap

EUR/GBP’s advance off last week’s £0.8296 low is about to reach the 16 February and 25 February highs at £0.8402 to £0.8408 around which the cross may stall, though.

If not, the current March high at £0.8458 would be back in play, together with the 200-day simple moving average (SMA) at £0.8471.

Minor support can be found along the 55-day SMA and 11 March low at £0.8362 to £0.836. Then there is yesterday’s low at £0.8322.

EUR/GBP chartSource: IT-Finance.com

Respite for the AUD/USD rally

AUD/USD’s strong rally has come close to its $0.7555 October peak but stalled just shy of it at $0.754 despite strong Australian retail sales data as traders assess the situation in Ukraine, the fall in the oil price and lockdowns in China.

This has come as no surprise to technical analysts since previous lows and highs often act as initial resistance when they are revisited. In this case the February and March 2021 lows with the October 2021 high at $0.7532 to $0.7564 create such a resistance zone.

Range trading below the $0.754 to $0.7555 October and current March highs is likely to ensue today. Support below yesterday’s low at $0.7467 can be spotted at the 7 March high at $0.7441. Only a rise and daily chart close above the February 2021 low at $0.7564 would push the January 2021 high at $0.782 to the fore.

AUD/USD chartSource: IT-Finance.com
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EUR/USD and GBP/USD move up while USD/JPY falls sharply

A possible sign of progress in talks between Russia and Ukraine has boosted EUR/USD, and GBP/USD has moved higher as well. USD/JPY, however, has fallen sharply.

 

 

EUR/USD moves higher

EUR/USD has made significant progress over the last two days, moving back above $1.11 and heading to the 50-day simple moving average (SMA) $1.1184. Additional upside from here heads towards trendline resistance around $1.13, but this would still create a lower high. Recent gains have been capped below $1.113, so a move above here would strengthen the short-term bullish view.

EUR/USD chartSource: ProRealTime

GBP/USD edges up

After losses earlier in the week, GBP/USD held its ground yesterday, and has edged higher this morning. This stabilisation could point towards a fresh attempt to move higher, targeting the highs from a week ago near $1.33. A reversal below $1.305 would hand the initiative to the sellers.

GBP/USD chartSource: ProRealTime

USD/JPY rally goes into reverse

At last, the sellers seem to have found their strength, pushing USD/JPY back below ¥122.00 after a huge rally this month. The latest higher high this week at ¥125.00 confirms the uptrend, but now a deeper retracement could come into play, potentially targeting a move back towards the 50-day SMA over time.

USD/JPY chartSource: ProRealTime
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EUR/USD in near one-month, EUR/GBP in three-month highs while USD/JPY slips lower

EUR/USD and EUR/GBP continue their advance as high inflation puts the ECB under pressure to start tightening its monetary policy while USD/JPY gives back some of its recent gains amid a weaker US dollar.

JPYSource: Bloomberg
 
 Axel Rudolph | Market Analyst, London | Publication date: Thursday 31 March 2022 

EUR/USD trades in near one-month highs

EUR/USD has risen above its $1.1137 mid-March high and is fast approaching the 55-day simple moving average (SMA) at $1.1199 in the wake of the highest German inflation reading since 1990 at 7.3%, putting the European Central Bank (ECB) under pressure to start tightening its monetary policy.

Further up resistance sits at the $1.128 mid-February low.

Minor support comes in between the January low, 10 and 17 March highs at $1.1137 to $1.1122. Slightly further down sits the 24 February low at $1.1107.

EUR/USD chartSource: IT-Finance.com

EUR/GBP trades in three-month highs above the £0.8478 to £0.8458 support zone

EUR/GBP’s swift ascent has taken it to a three-month high at £0.8512 earlier today on the back of renewed buying interest in the Euro as markets continue to price in tighter monetary policy conditions.

The cross is likely to revisit the £0.8478 to £0.8458 support zone which incorporates the February and mid-March highs as well as the 200-day SMA. As such it is expected to hold today. If not, the late January high at £0.8422 would be back in the frame.

Above today’s high at £0.8512 lies the late December high at £0.8554.

EUR/GBP chartSource: IT-Finance.com

USD/JPY continues to give back recent gains

On Monday USD/JPY briefly overshot the June 2007 high at ¥124.13 and rallied to ¥125.10, to not far below the June 2015 peak at ¥125.85, before giving back some of its recent gains on the back of a weaker US dollar, due to the slightly better Ukraine/Russia backdrop.

The cross became increasingly overbought as it had risen by over +8% since the beginning of March as the Bank of Japan (BoJ) re-iterated its dovish stance despite inflation hitting 3-year highs while the US Federal Reserve (Fed) is seen hiking rates by 50 basis points (bp) at the next two Federal Open Market Committee (FOMC) meetings to contain sky-high US inflation.

USD/JPY chartSource: IT-Finance.com
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EUR/USD and GBP/USD under pressure as USD/JPY recovers

A stronger dollar has lifted USD/JPY, while putting pressure on EUR/USD and GBP/USD.

 

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Friday 01 April 2022 

EUR/USD lower high now in play?

The bounce here with EUR/USD has stalled at the 50-day simple moving average (SMA), and with the pair beginning to move lower in opening trading a fresh move to the downside may be developing.

This might signal the resumption of the downtrend, potentially targeting $1.08 and lower. A rally above $1.12 negates this view.

EUR/USD chartSource: ProRealTime

GBP/USD heads lower

The small gains with GBP/USD from earlier in the week appear to be at risk, as the price drops back towards $1.312.

Additional declines below $1.305 would put the price below Tuesday’s low, and open the way to $1.3 and lower.

GBP/USD chartSource: ProRealTime

USD/JPY recovers some losses

After slowing its decline yesterday USD/JPY has moved higher, recouping some lost ground. This revival puts recent highs at ¥125.00 into view.

Sellers will need to find a way to push the price back below ¥121.30 to suggest a deeper retracement is still possible.

USD/JPY chartSource: ProRealTime
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EUR/USD under pressure and USD/JPY recovers, while GBP/USD holds steady

A strengthened dollar has lifted USD/JPY again, while putting pressure on EUR/USD. For now, sterling appears to be holding its ground against the dollar.

 

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Monday 04 April 2022 

EUR/USD in retreat from recent highs

Two days of losses in EUR/USD and a retreat from the 50-day simple moving average (SMA) $1.1169 point towards a potential lower high and the beginning of a new leg lower for the pair. This would bring $1.08 into view, the low from the beginning of March into play. Stochastics have rolled over too, suggesting this downtrend has further to run.

EUR/USD chartSource: ProRealTime

GBP/USD steady despite losses

GBP/USD price has managed to hold its ground despite coming under some pressure on Friday. As yet further losses have not materialised, although a drop below $1.305 would mark a bearish development. Buyers will want to see a move back above $1.318 to open the way to a potential challenge of the highs from the second half of March, around $1.328.

GBP/USD chartSource: ProRealTime

USD/JPY pushes higher

Friday’s jobs report strengthened the dollar, reversing some of the recent losses. It looks like USD/JPY may push back to the late March highs, despite the apparent overextension of the rally indicated by the yawning gap with the 50-day SMA ¥117.10. Sellers would need to push the price back below ¥121.20 to suggest a nearterm retracement is underway.

USD/JPY chartSource: ProRealTime
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EUR/USD, EUR/GBP slip on euro weakness while AUD/USD rallies post RBA meeting

EUR/USD and EUR/GBP continue to slide on the back of a depreciating euro while the Australian dollar surges higher as the RBA drops the ‘patient’ pledge in its April statement, pointing to future rate hikes.

 

 

 Axel Rudolph | Market Analyst, London | Publication date: Tuesday 05 April 2022 

EUR/USD slips towards $1.0945 late March low

EUR/USD has slipped through its one-month downtrend line at $1.1002 and is heading down towards its late March low at $1.0945 as traders await US ISM non-manufacturing purchasing managers’ index (PMI) for March.

A slip through $1.0945 would engage the mid-March $1.0901 low. Further down sits the $1.0806 early March low.

Strong resistance remains to be seen between the January low and March high at $1.1122 to $1.1185. While the cross stays below this area, this year’s downtrend remains intact.

EUR/USD chartSource: IT-Finance

EUR/GBP’s swift decline weighs on one-month support line

EUR/GBP’s bearish reversal from its £0.8512 late-March high is grappling with the one-month support line at £0.8365, a daily chart close below which would push the £0.8305 to £0.8286 support zone to the fore. It consists of several daily lows made in January, February and on 23 March.

Minor resistance can be spotted between the 16 and 25 of February highs at £0.8402 to £0.8408.

Further up lies the mid-March high at £0.8458 and meanders the 200-day simple moving average (SMA) at £0.8467.

EUR/GBP chartSource: IT-Finance

AUD/USD trades in ten-month highs on RBA rate hike expectations

AUD/USD surges higher after the Reserve Bank of Australia (RBA) dropped the ‘patient’ pledge in its April statement, leading investors to believe that the central bank will start to raise rates at its next meeting, having kept these at their record low of 0.1% for the 16th month in a row in today’s meeting.

The cross is trading at levels last seen in June 2021 and targets that month’s high at $0.7775, as well as the January 2021 peak at $0.782.

Previous resistance at $0.7564 to $0.7532, consisting of the January and March 2021 lows and October 2021 high, should now act as support, if revisited at all.

AUD/USD chartSource: IT-Finance
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EUR/USD, EUR/GBP GBP/USD slip on Euro weakness and US Dollar strength

EUR/USD and EUR/GBP continue to drop amid a depreciating Euro with GBP/USD being under the cosh as well as the US Dollar continues its strong appreciation.

 

 

 Axel Rudolph | Market Analyst, London | Publication date: Wednesday 06 April 2022 

EUR/USD slips towards the $1.0806 March low

EUR/USD is seen sliding for its fifth consecutive day and is fast approaching the $1.0806 early March low as the US Dollar continues to appreciate ahead of this evening’s Federal Open Market Committee (FOMC) minutes.

Given the strength of the current decline, which has come after a corrective wave to the upside during much of March, it is likely that the $1.0806 low will soon be fallen through with the February 2020 low at $1.0778 representing the next downside target. Further down lies the $1.0727 April 2020 low.

The late March low at $1.0945 and breached one-month downtrend line at $1.1008 should now act as resistance, if revisited at all. Major resistance remains to be seen between the January low and March high at $1.1122 to $1.1185. While the cross stays below this area, the long-term downtrend remains valid.

EUR/USD chartSource: IT-Finance.com

EUR/GBP’s swift decline is heading towards a support zone

EUR/GBP’s bearish reversal from its £0.8512 late March high has taken it through the one-month support line at £0.8373 towards the £0.8305 to £0.8286 support area on the back of a weaker Euro as German factory orders decline by 2.2% month-on-month (MoM), much worse than the expected 0.2% drop.

It is the first fall in four months as supply constraints, soaring energy prices and uncertainty linked to Russia's invasion of Ukraine negatively impact foreign demand. The £0.8305 to £0.8286 support zone contains several daily lows made in January, February and on the 23 March and as such is expected to withstand the first test.

Minor resistance above the breached one-month support line at £0.8373 can be spotted between the 16 and 25 February highs at £0.8402 to £0.8408.

EUR/GBP chartSource: IT-Finance.com

GBP/USD continues its descent towards the March low at $1.3001

GBP/USD earlier today flirted with the late March low at $1.3051 as the US dollar continues to appreciate amid investors betting on the Federal Reserve (Fed) raising rates by 225 basis points (bp) by year end.

A fall through $1.3051 would engage the March trough at $1.3001, below which there is no support to speak of until the $128.55 to $1.2813 June 2020 high and November 2020 low.

Immediate downside pressure should be maintained while the cross remains below the two-month downtrend line at $1.3149 and, more importantly, the 30 March and 5 April highs at $1.3167 to $1.3182.

GBP/USDSource: IT-Finance.com
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US Dollar Index trades in near 2-year highs as EUR/USD, EUR/GBP slide

The US Dollar Index trades in 23-month highs while EUR/USD and EUR/GBP continue to sell off amid depreciating Euro.

 

 

 Axel Rudolph | Market Analyst, London | Publication date: Thursday 07 April 2022 

EUR/USD drops towards the $1.0806 March low

EUR/USD is seen sliding for its sixth consecutive day towards the $1.0806 early March low as the US Dollar continues to appreciate following the publication of the March Federal Open Market Committee (FOMC) minutes which confirmed the Federal Reserve's (Fed) hawkish stance and rapid balance sheet unwind.

In view of the speed of the current decline, it is expected that the $1.0806 low will soon be slid through with the February 2020 low at $1.0778 representing the next downside target. Further down sits the $1.0727 April 2020 low. The late March low at $1.0945 and breached one-month downtrend line at $1.102 should now act as resistance, if revisited at all.

Major resistance remains to be seen between the January low and March high at $1.1122 to $1.1185. While the cross stays below this area, the long term downtrend remains intact.

EUR/USD chartSource: IT-Finance.com

EUR/GBP’s swift decline nears support zone

EUR/GBP’s drop through the one-month support line at £0.838 has taken it close to the £0.8305 to £0.8286 support area as traders assess the impact additional sanctions on Russia may have on European economies.

The £0.8305 to £0.8286 support area contains several daily lows made in January, February and on the 23 March and as such is expected to withstand the first test. If not, one would have to allow for the March trough at £0.8203 to be back in focus.

Minor resistance is seen along the 55-day simple moving average (SMA) at £0.8369 and also along the breached one-month support line, now resistance line, at £0.838. Further up sit the 16 and 25 February highs at £0.8402 to £0.8408.

EUR/GBP chartSource: IT-Finance.com

The US Dollar Basket remains in 23-month highs

Since yesterday the US Dollar Index (DXY) is trading in near 2-year highs as bonds dropped aggressively and equites sold off in the wake of the US Fed Vice Chair-elect Lael Brainard comments which put the reduction in Fed’s balance sheet back at the centre of the monetary policy discussion.

The psychological 100.00 mark is within reach, now that a break out of the one-month consolidation phase has taken place. For the past month or so the index has been capped by the 99.29 to 99.45 resistance area but repeatedly bounced off the 97.78 to 97.69 support zone.

Slips may find support between the 4 and 28 March highs at 99.33 to 99.29. Further down sits the 22 March high at 98.94 which may also offer support, if revisited at all.

DXY chartSource: IT-Finance.com
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US Dollar Index nears psychological 100 mark as EUR/USD, EUR/GBP slide further

The US Dollar Index is trading at levels last seen in May 2020 and targets that month’s high at 100.60 while the EUR/USD and EUR/GBP continue to slide ahead of France’s Sunday first round presidential election.

EURSource: Bloomberg
 
 Axel Rudolph | Market Analyst, London | Publication date: Friday 08 April 2022

EUR/USD is getting ever closer to the $1.0806 March low

EUR/USD is seen sliding for its seventh consecutive day and by nearly 3% from last week’s high towards the $1.0806 early March low as the US Dollar (USD) continues to appreciate following the publication of the March Federal Open Market Commitee (FOMC) minutes which pointed to a rapid balance sheet unwind and faster interest rate hikes to nip surging inflation in the bud.

In view of the speed of the current decline, it is expected that the $1.0806 low will soon be fallen through with the February 2020 low at $1.0778 representing the next downside target. Further down sits the $1.0727 April 2020 low.

Above yesterday’s high at $109.38, minor resistance can be spotted at the late March low at $1.0945 and breached one-month downtrend line at $1.1029. Major resistance remains to be seen between the January low and March high at $1.1122 to $1.1185. While the cross stays below this area, the long-term downtrend remains valid.

EUR/USD chartSource: IT-Finance.com

EUR/GBP’s swift decline nears £0.8305 to £0.8286 support zone

EUR/GBP’s near 2.5% decline from last week’s high at £0.8512 has taken it very close to the £0.8305 to £0.8286 support area as the Euro continues its slide on worries about Sunday’s first round presidential election in France as polls show that the race between incumbent president Macron and contender Marine le Pen is narrowing.

The £0.8305 to £0.8286 support area contains several daily lows made in January, February and on the 23 of March and as such is expected to hold today. If not, the March trough at £0.8203 would be targeted.

Minor resistance is seen between yesterday’s high and the 55-day simple moving average (SMA) at £0.8364 to £0.8368 and also along the breached one-month support line, now resistance line, at £0.8388. Further up sit the 16 and 25 of February highs at £0.8402 to £0.8408.

EUR/GBP chartSource: IT-Finance.com

The US Dollar Index edges higher towards the critical 100 mark

The US Dollar Index (DXY) is trading in 23-month highs, underpinned by the prospect of a more aggressive pace of US Federal Reserve (Fed) tightening and hawkish remarks from several FOMC committee members who called for faster interest rate hikes to curb surging inflation.

The US Dollar Basket, which has risen for six consecutive days, is about to hit the psychological 100.00 mark, having earlier in the week broken out of its one-month consolidation to the upside. Previously the index had been capped by the 99.29 to 99.45 resistance area but repeatedly bounced off the 97.78 to 97.69 support zone. The former should now act as support.

Further down sits the 22 March high at 98.94 which may also offer support, if revisited at all. Above the 100 mark the May 2020 high at 100.60 represents the next upside target.

DXY chartSource: IT-Finance.com
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EUR/USD, EUR/GBP remain under pressure while USD/JPY trades in near 20-year highs

EUR/USD and EUR/GBP flirt with last week’s lows as worries about the outcome of the French presidential election weigh on the Euro while USD/JPY is trading at levels last seen in May 2002.

EUR/USDBloomberg
 

 Axel Rudolph | Market Analyst, London | Publication date: Tuesday 19 April 2022

EUR/USD drops towards the $1.0727 April 2020 low on firmer Dollar

EUR/USD revisits last week’s low at $1.0758, having slid through its $1.0806 early March low, with the April 2020 trough at $1.0727 being next in line.

The US Dollar continues to appreciate amid escalating worries of further lockdowns in China, Russia apparently beginning the second phase of its advance in the Donbas region of Ukraine and mounting signs of more interest rate hikes being in the pipeline globally.

This contrasts with ongoing Euro weakness due to the war in Ukraine and worries about the outcome of this weekend’s second round of France’s presidential election in which the incumbent Emmanuel Macron is battling it out with his right-wing rival Marine Le Pen.

The trend in EUR/USD will remain immediately bearish while the cross stays below the late March low and last week’s high at $1.0933 to $1.0945 with the March 2020 low at $1.0638 representing a downside target for the weeks ahead.

Major resistance remains to be seen between the January low and March high at $1.1122 to $1.1185. While the cross stays below this area, the long-term downtrend remains intact.

EUR/USDIT-Finance.com

EUR/GBP’s bounce off last week’s low at £0.8250 looks vulnerable

EUR/GBP bounce off Thursday’s £0.825 low has been very tepid with the cross so far not even reaching the 23 March low at £0.8296 as the Euro remains under pressure amid heightened tensions in Eastern Ukraine and worries surrounding the second round of the French presidential elections.

Further minor resistance is found at the £0.8308 8 April low and at the £0.8322 late March low.

A fall through last week’s low at £0.825 would put the March trough at ££0.8203 on the map.

EUR/GBPIT-Finance.com

USD/JPY trades in near 20-year highs

USD/JPY is trading at levels last seen in May 2002, having practically closed higher every single day since the beginning of April, probably its longest losing streak in at least half a century , as traders continue to focus on the widening gap between US and Japanese interest rates.

Comments by the Federal Reserve Bank (Fed) of St. Louis President James Bullard which mentioned the possibility of 75 basis point (bp) rate hikes being seen in the US led to another surge higher in the USD/JPY cross with it gunning for the ¥135.18 January 2002 peak.

Good support can now be seen between the June 2015 and March 2022 highs at ¥125.85 to ¥125.10 which is unlikely to be revisited anytime soon, though, if the Bank of Japan’s (BOJ) keeps sticking to its dovish stance despite inflation hitting at 3-year highs.

USD/JPYIT-Finance.com
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GBP/USD holds firm, while US dollar weakens versus Aussie and Canadian dollars

The pound is holding steady against the dollar, but the greenback is struggling against the Aussie and the Loonie.

 

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Wednesday 20 April 2022 

GBP/USD still hovering above $1.30

The pound has edged up this morning and has avoided pushing through recent lows with GBP/USD. Once again, the dollar seems to have the upper hand overall, as US policymakers begin to talk about the need for an even faster pace of rate increases to deal with inflation.

Supply chain worries coming out of China thanks to their strict lockdown policies threaten to intensify the rise in prices, and even previously firm dove Neel Kashkari is calling for a more aggressive response to inflationary pressures. Set against this, the Bank of England's (BoE’s) more cautious approach leaves the pound lacking support against the greenback in the medium term.

But for now, the pair continues to hold $1.3. In the event of a turn lower, $1.2854 and then $1.2773 come into view as downside targets. Meanwhile to the upside the price will look towards $1.314.

GBP/USD chartSource: ProRealTime

AUD/USD recovers for a second day

AUD/USD has bounced from the 50-day simple moving average (SMA) and is making firm moves to the upside after the decline of the last three weeks. Stronger commodity prices have helped the Aussie to make some headway against the US dollar, potentially marking a resumption of the upward moves from February and the first half of March.

This comes despite the talk by some Federal Open Market Committee (FOMC) members of an event faster pace of tightening. But the Australian economy continues to be a major beneficiary of rising commodity prices, and thus investors continue to scramble over one another to gain exposure to the economy.

Current price action does point towards the creation of a higher low over the past two days; the price hit the 50-day SMA on Monday and then moved higher yesterday, building on those gains today. After the pullback from the April higher high, a new higher low would reinforce the bullish view and bring $0.76 back into view.

AUD/USD chartSource: ProRealTime

USD/CAD risks a fresh downturn

The US dollar appears to be at risk of a new decline against the Loonie, as the April bounce fizzles out in the C$1.265 area. Here too the US dollar’s triumphal progress has been halted, and after the small bounce in early April USD/CAD looks set for further declines.

The oil weakness we saw yesterday provided some respite, but talk of further increases in the pace of US tightening is not having the same effect as in other currency pairs.

Having seen the price falter at the 50-day SMA and now the 200-day SMA, traders may expect an additional turn lower. This puts the C$1.245 lows from the beginning of April back into play, and potentially lower. Longs have a major set of hurdles around C$1.26 and higher to navigate if a more bullish view is to emerge.

USD/CAD chartSource: ProRealTime
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EUR/USD and EUR/GBP rally post French election TV debate while GBP/USD stalls

EUR/USD and EUR/GBP were boosted by yesterday’s French election TV debate which does not seem to have dented the incumbent’s chances of winning Sunday’s election while GBP/USD stalls.

 

 

 Axel Rudolph | Market Analyst, London | Publication date: Thursday 21 April 2022 

EUR/USD swiftly bounces off support

EUR/USD rally off last week’s low at $1.0758 has taken the cross to the minor $1.0933 to $1.0945 resistance zone. The rally in EUR/USD has come on the back of falling US Treasury yields and a slightly widening gap in the opinion polls between the centrist incumbent Emmanuel Macron and his far-right rival Marine Le Pen, projecting the former to secure between 53% and 57% of the vote in Sunday’s second round of the French presidential election.

Yesterday’s over 2 1/2-hour long television debate between the two candidates probably didn’t have much of an impact on the overall outcome which the Euro took as a positive and accelerated higher. Were the $1.0933 to $1.0945 late March low and 6, 7 and 11 April highs to be exceeded, a pause in the currency pair’s downtrend would likely unfold, especially since positive divergence can be spotted on the daily Relative Strength Index (RSI). A possible upside target is the February-to-April resistance line at $1.105. Potential slips should find support around the 8 April low at $1.0837.

Key support remains to be seen at the mid-April trough at $1.0758, below which the April 2020 low can be made out at $1.0727 and the March 2020 low at $1.0638.

EUR/USD chartSource: IT-Finance.com

EUR/GBP’s bounce has reached the 55-day simple moving average (SMA) at £0.8361

EUR/GBP bounce off last week’s £0.825 low has gained traction after yesterday’s French election TV debate between the remaining two candidates, the incumbent President Macron and his right-wing rival Marine Le Pen, is not deemed to have dented the former’s better standings in the polls.

Above the 55-day simple moving average (SMA) at £0.8361, which is currently being probed, lies the 11 April high at £0.838, a rise above which would change the short-term outlook back to being bullish.

Minor support can be found at the 28 March low at £0.8322 and also at the 8 April low at £0.8308 today. Further potential support can be seen at the 23 March £0.8296 low.

EUR/GBP chartSource: IT-Finance.com

GBP/USD struggles along the two-month downtrend line at $1.3082

The recovery in GBP/USD from Tuesday’s low at $1.2981 seems to have been short-lived with it failing along the two-month downtrend line at $1.3082 despite US Dollar weakness being witnessed across the board as US Treasury yields are falling back from their recent peaks.

Strong support remains to be seen between the March and current April lows at $1.3001 to $1.2973 whereas resistance above today’s intraday high at $1.3082 can be found at last week’s $1.3147 top. While the $1.3147 to $1.3182 late March and current April highs aren’t bettered, a downtrend remains in place.

Failure at $1.2973 would lead to the $1.2855 to $1.2813 area being targeted. It contains the June 2020 high and November 2020 low.

GBP/USD chartSource: IT-Finance.com
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