EUR/USD and GBP/USD expected to roll over as USD/JPY grinds higher once again
Dollar domination is expected to continue, with recent retracements for EUR/USD, GBP/USD, and USD/JPY expected to resolve in favour of the trend.
EUR/USD ticks higher after touching parity
EUR/USD managed to finally reach the parity level, with yesterday’s price action seeing the pair reach 1.00 for the first time in 19-years. However, that level represented the absolute bottom of the day, with price ticking slightly higher in the hours that followed. This points towards a potential retracement or consolidation phase taking shape for the near-term.
Nonetheless, the pair trades within a very clear bearish trend as things stand. With that in mind, it looks likely we will soon enough see the pair turn lower to break back below parity. A rise up through the 1.0191 would be required to signal a wider retracement coming into play.
GBP/USD on the rise but bullish trend holds
GBP/USD will be in focus this morning, with UK Gross Domestic Product (GDP) managing to outperform estimates after rising to 0.5% for just May alone. We have seen the pound gaining ground against the dollar over the course of the past 24-hours, regaining ground after yesterday’s move into a two-year low.
It is worth noting that this pair has lost ground six of the past seven weeks. With that in mind, any short-term gains are expected to return back to the downside before long. Should we see any further strength today, the 61.8% and 76.4% Fibonacci levels look like an interesting position for shorts. A break up through the 1.2056 swing-high would be required to signal a wider retracement coming into play.
USD/JPY pushing back towards 23-year highs
USD/JPY has been a reliable outperformer over recent months, with the pair hitting a 23 year-high on Monday. We have seen price easing back since, but the bulls are once again in charge as price pushes back up towards that 137.75 level.
Nonetheless, until that peak is overcome, there is still a chance of a deeper retracement towards trendline support. Whether that happens or not, the wider trend points towards another upside breakout before long, with a decline through 135.32 required to bring a more bearish near-term view into play.
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