EUR/USD and GBP/USD gain ground, as USD/JPY looks to turn lower
EUR/USD and GBP/USD are showing signs of potential upside after recent declines. Meanwhile, overnight USD/JPY gains look like a precursor to further losses.
EUR/USD showing signs of an impending bullish phase
EUR/USD has been on the slide of late, yet that could be coming to an end after yesterday’s rebound into the notable $1.1025 level.
While the price has drifted lower since, that failure to create a lower high points towards a potential move higher from here. The price has since retraced into 76.4% Fibonacci support ($1.0984), with a distinct possibility of upside from here. A break back below $1.0984 would point towards that bearish trend coming back into play, yet another rebound remains a distinct possibility from here. Ultimately it will take a rally through that $1.1025 level to negate the recent downtrend.
GBP/USD gains ease after initial Supreme Court rebound
GBP/USD gained ground yesterday, off the back of a Supreme Court ruling that sees parliament resume to the detriment of UK Prime Minister Boris Johnson and his Brexit plans. This allows greater scrutiny of his Brexit process and lessens the chance of a no-deal Brexit.
For GBP/USD, we are seeing mixed signals given the recent breakdown below $1.2438 support. That breakdown points towards the subsequent rally being a likely retracement before we turn lower. However, while we have been seeing overnight weakness, momentum appears to be shifting and another leg higher looks likely over the short term. Ultimately, we will need to see the price break through either $1.2582 or $1.2415 to provide a convincing directional bias. Until then, the short-term picture looks bullish following an overnight pullback. Watch for a stochastic move through 20 to provide confirmation of such a move.
USD/JPY rebound unlikely to last
USD/JPY has been trending lower over the past week, building on the topping pattern that appears to have played out from trendline resistance.
The continued creation of lower highs and lows points towards this current rally being a likely retracement before we turn lower once again. As such, bearish positions are preferred unless the price breaks through the ¥107.77 level.
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