EUR/USD edges down, while GBP/USD holds steady and USD/JPY rises
The euro has fallen back from last week’s highs against the dollar, while USD/JPY is moving up for a second day. GBP/USD is holding firm in a busy week for UK data.
EUR/USD falls back from highs
The price of EUR/USD has retreated from last week’s highs, though the uptrend is intact.
A higher high may well be created, reinforcing the uptrend, with a pullback towards the 50-day simple moving average (SMA) resulting from this short-term weakness. A strengthening of the US dollar would provide the fundamental catalyst for such a move.
A revival back above $1.185 would likely negate the higher high, and open the way towards the March 2022 highs at $1.146.
GBP/USD hovers around $1.22
GBP/USD has also seen bullish momentum fade over the past day, though not sufficient to reverse the nascent bullish view.
A move back below the $1.205 level would push the price below the 50-day SMA and suggest a potential reversal is in play, with a lower high being created. Buyers will want to see the price move on above the December high at $1.24.
This week’s UK consumer price index (CPI) reading may well provide the catalyst for such moves, with a weaker CPI acting to push GBP/USD lower.
USD/JPY edges up for a second day
A small bounce here with USD/JPY barely changes the bearish view, which has seen the price lose ground over the past month.
A recovery towards ¥132.00 might see further selling pressure develop, maintaining the downward trend. Further declines target the ¥126.60 level, last seen in May 2022.
This week’s Bank of Japan (BoJ) meeting may well see volatility increase, but a move above ¥133.00 would be needed to suggest that the downward move has run its course for now.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
