Has USD bull trend run out of steam?

Euro and sterling take advantage of widespread USD weakness.

US dollar notes
Source: Bloomberg

GBP/USD vaults higher

GBP/USD has spiked higher during the London open. The pair added +0.11% following an overnight move where it posted a low of $1.5501, after recording a high of $1.5548 despite a weakening in UK housing prices, according to the Nationwide housing survey, released on Tuesday.
Despite the sharp spike higher on Tuesday, the move wasn’t enough to see the pair’s relative strength index indicator move into expansionary territory. It is currently trading at 49.3, which suggests a possible retest of downside targets with intermediate resistance likely to be seen at $1.5472.

Spot FX GBP/USD chart

Euro higher despite weak Spanish data

EUR/USD has also benefited from USD weakness, adding +0.02% on Tuesday, and is currently trading at $1.2156 having posted an overnight low of $1.2124. The move higher in the euro comes in spite of weak data, released pre-London open, which saw a deflationary trend remain intact in the Spanish economy with its consumer price index (CPI) coming in at -1.1% from its previous level of -0.5%.

Tuesday’s intermediate support/resistance levels to the downside present themselves at $1.2140, which if held could see a retest to the topside at $1.2224.

Spot FX EUR/USD chart

The information 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 Bank S.A. 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 and as such is considered to be a marketing communication.

Find articles by analysts