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EUR/USD rises, USD/JPY slips on Fed minutes US while EUR/GBP tries to stabilise

​​Fundamental commentary and technical analysis on EUR/USD, USD/JPY and EUR/GBP.

​​​EUR/USD extends rally after Fed minutes

​​EUR/USD is on a three-day winning streak, helped by the US Federal Reserve (Fed) considering slower rate hikes to be appropriate in the current economic environment, as stated in Wednesday’s Fed minutes.

​The cross thus trades back above its 200-day simple moving average (SMA) at $1.0395 and is gunning for its $1.0481 November peak as the US celebrates Thanksgiving. Further up lies key resistance between the $1.0615 late-June high and the $1.0638 March 2020 Covid-19 pandemic low.

​Slips should find support around the $1.0368 August peak and the $1.034 November support line.

​EUR/GBP stabilises above key support

​The slide in EUR/GBP is ongoing with the currency pair now trading in three-week lows but holding above its solid support which sits between the mid- and late-October lows at £0.858 to £0.8572 ahead of Monetary Policy Members (MPC) Ramsden, Pill and Mann speaking in the course of the day.

​As long as the £0.858 to £0.8572 support zone holds, a bounce back to the two-week downtrend line at £0.8689 is on the cards. Having said that, only a rise above Tuesday’s high at £0.8701 could lead to another up leg being made with the 55-day SMA at £0.8727 then being in focus.

​Failure at £0.8572 would engage the 200-day SMA at £0.8532.

​USD/JPY drops towards ¥137.68 mid-November low post Fed minutes

USD/JPY is seen heading back down towards its ¥137.68 mid-November low for the third consecutive day following Wednesday’s US Fed minutes which showed that a substantial majority of policymakers agreed it would soon be appropriate to slow the pace of interest rate hikes as they access the impact of its tightening policy on the economy.

​A fall through the current-November low at ¥137.68 would put the early-August high at ¥135.58 on the map. Further down slithers the 200-day SMA at ¥133.86.

​Immediate minor resistance can be made out around the minor psychological ¥140.00 mark and in the ¥140.29 to ¥140.80 zone where 14 to 18 November highs were made. Further minor resistance is tucked away at the ¥141.51 9 September low. ​Provided that this-week’s high at ¥142.25 isn’t overcome, the October-to-November downtrend remains intact.


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