EUR/USD, GBP/USD, and USD/JPY see dollar take a breather

EUR/USD, GBP/USD and USD/JPY reverse after dollar dominance, but will it last?

​EUR/USD slumps into two-month lows

EUR/USD has dropped into a two-month low following a head and shoulders breakdown earlier in the week.

The pair has been extending those losses since breaking below that $1.2059 support level. That bearish picture holds for now, with a move through the $1.2050 swing high required to negate this short-term downtrend.

GBP/USD rebounds into deep retracement zone

GBP/USD has managed to regain ground after the wedge breakdown seen earlier in the week. While price has broken up through trendline resistance, there is a good chance we see this wider Fibonacci retracement zone come into play.

Ultimately the wedge breakdown does raise the risk of a more protracted pullback. Thus it makes sense to watch for a rise through the $1.3858 level to resume the wider bullish trend. Until then, watch for whether price respects of break the $1.3712 resistance level.

USD/JPY starts to reverse after latest leg higher

USD/JPY is in retracement mode after a period of gains that took the pair into the highest level since mid-November.

With a clear uptrend in play here, the current decline looks likely to provide a retracement phase before we move higher once again. That view holds unless we see price break below the ¥104.97 swing-low.

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