The euro benefits while the US dollar is taking a dive
Euro strength pushes EUR/USD as dollar weakens.
The rally in EUR/USD continues unabated
EUR/USD continues to surge higher and is in the process of breaking out of its November-to-January channel which contained the cross until now.
The October-to-early-November lows at $1.1513 to $1.1539 are now firmly in view but are likely to put a dampener on the current advance. If not, we would have to allow for the September trough at $1.1563 to be reached as well.
Solid support can now be seen between the late-November and December highs at $1.1386 to $1.1383. While above there, upside pressure should retain the upper hand.
EUR/GBP continues to oscillate around the £0.8350 level
EUR/GBP is trying to recover from this year’s low to date at £0.8324 and is likely to reach the 55-period simple moving average (SMA) on the 240 minute chart at £0.8357. A rise above it would probably engage the £0.8366 to £0.8373 resistance area which acted as support late last year and as resistance early this year.
While the next higher early January high at £0.8418 isn’t exceeded, the longer term downtrend (in place since September of last year), remains intact.
Only a tumble through the recent low at £0.8324 would put the December 2016, April 2017, December 2019 and February 2020 lows at £0.8313 to £0.8277 on the cards. This area represents key long-term support which is expected to underpin the cross.
USD/JPY remains in free fall
USD/JPY continues to come off its early January 4-year high at ¥116.35 and drops towards the 55-day simple moving average (SMA) and mid-December high at ¥114.30 to ¥114.27, having so far reached the ¥114.44 early November high.
In case of the above mentioned support giving way, the 29 November and 8 December highs at ¥113.96 would be next in line.
Good resistance now comes in between the mid-November high and the 3 January low at ¥114.95 to ¥114.97.
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