EUR/USD, EUR/GBP and USD/CAD try to stabilise ahead of long weekend
Outlook on EUR/USD, EUR/GBP and USD/CAD amid ongoing US debt ceiling negotiations and as Germany entered a recession on Thursday.
EUR/USD trades in two-month low as Germany entered a recession
EUR/USD’s decline has taken it to a new two-month low on flight-to-safety flows into the US dollar amid US debt ceiling worries and as Germany officially entered a recession on Thursday.
The currency pair is flirting with the 24 March low at $1.0714, below which sits the early-March high at $1.0695.
Resistance remains to be seen at last week’s $1.076 low and then around the $1.0789 early April low. While the next higher 10 April low at $1.0832 isn’t overcome, downside pressure should remain in play.
EUR/GBP holds despite Germany entering a recession
EUR/GBP’s slide to levels last traded in December of last year, to £0.8649, has been followed by another minor recovery rally back towards the middle of its recent sideways trading range.
The cross is still trying to head back up towards this week’s high at £0.8719, above which beckons the 200-day simple moving average (SMA) at £0.8751 which a couple of weeks ago acted as resistance and may do so again.
Above it the late-February low at £0.8755 may also stall an attempt of a move higher taking place, together with the early-May low at £0.876. Minor support can be noticed between 11 and 19 May lows at £0.8669 to £0.8662 and major support at this week’s £0.8649 trough.
USD/CAD falters close to its April peak
USD/CAD’s advance on a stronger greenback, due to flight-to-quality flows on the back of ongoing US debt ceiling negotiations, ran out of steam slightly below its C$1.3668 late-April peak.
A slide back towards the mid-May high at C$1.3568 may thus be in store. Below it more significant support can be seen between the 10 April high, 55-day SMA and one-month uptrend line at C$1.3553 to C$1.3527.
Were a currently unexpected advance to above the C$1.3668 high to unfold, the late-March high at C$1.3804 would be back in the frame.
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