EUR/USD mixed, GBP/USD recovers while USD/JPY trades near seven-month high
Outlook on EUR/USD, GBP/USD and USD/JPY as German Ifo business climate disappoints and central banks except the BoJ remain hawkish.
EUR/USD tries to hold after two-day loss
At the end of last week EUR/USD fell back from its six-week high at $1.1012 amid weak Eurozone flash purchasing managers indices (PMIs) with it dropping to $1.0845.
This week the cross began on a more positive footing above the 55-day simple moving average (SMA) at $1.0886 which is back in sight due to a weaker-than-expected German Ifo business climate reading for May. While it holds, though, the breached June uptrend line at $1.0943 remains a possible upside target, together with the $1.097 mid-June high.
Support below last week’s trough at $1.0845 is seen around the 22 May high at $1.0832 below which lies the $1.08 region.
GBP/USD bounces off support
Last week GBP/USD slid to $1.2687 despite the Bank of England (BoE) raising its rates by 50 basis points (bps) for a 13th time to 5.00% as investors worried about the impact these hikes might have on the UK economy.
While $1.2687 underpins, the medium-term uptrend may continue, though, with the 16 June low at $1.2768 representing the first upside target. Further up sits key resistance at last week’s $1.2841 to $1.2848 highs.
If last week’s low at $1.2687 were to be slipped through, the $1.2679 May peak may offer support. If not, a drop back towards the $1.2599 to $1.2544 early-to-mid-June highs could ensue.
USD/JPY trades in seven-month highs
The USD/JPY advance is ongoing amid a hawkish Federal Reserve (Fed) and a ultra-dovish Bank of Japan (BoJ) with the ¥145.00 region remaining in sight.
Minor support below Friday’s ¥142.69 low can be spotted at the late November 2022 peak at ¥142.25.
Below it lies last week’s low at ¥141.22 and the ¥140.93 May peak.
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