EUR/USD drifts but USD/JPY and USD/CAD make headway
While the euro sits near recent lows, the US dollar is advancing against the yen and the Canadian dollar.
EUR/USD consolidates after recent weakness
Gains this week with EUR/USD have been stalled below $1.095, as any buying pressure is held in check ahead of Thursday’s US inflation reading.
However, for the moment a downward movement is also contained, with buyers stepping in around $1.09. For the time being the broader uptrend from the lows of October is intact, and the current price action could yet resolve into a higher low.
In this event, the price would target the late December highs at $1.11
USD/JPY boosted by weaker Tokyo inflation
After surging above the 200-day simple moving average (SMA), the price of USD/JPY has moved higher, boosted by weaker Tokyo inflation that provides an indication of weakening price pressures in the rest of Japan.
Tuesday saw a retest of the 200-day SMA from above, but buyers defended the indicator, leaving the pair poised to challenge the ¥144.90 resistance zone.
Continued price action above ¥143.30 would reinforce the bullish view, and would open the way to the 50-day SMA in the short-term. Conversely, a close back below ¥143.00 would mark another possible move back towards the late December lows.
USD/CAD stuck below C$1.34
USD/CAD has continued to surge, and has now reached the mid-December high at C$1.34, which provided some short-term resistance.
Further gains open the way to the highs of late November and early December at C$1.36.
However, a lower high is still a possibility, and a reversal back below C$1.33 would suggest that a new leg lower has begun.
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