EUR/USD down while USD/JPY rallies off Monday lows

Monday’s dollar strength has abated slightly, but a rebound in USD/JPY may not have much further to run.

EUR/USD edges back after recent gains

The EUR/USD price remains close to its recent highs and continues to show signs of buying strength around $1.135.

However, we have seen some weakness over the past 24 hours, with a rally towards $1.142 running out of steam overnight. A push back above here then heads towards $1.15, while further losses below $1.134 would mark the development of a short-term downtrend.

GBP/USD holds firm after Monday’s losses

The GBP/USD retracement yesterday may well have run its course, now that it has found support above $1.30. If this marks the first higher low in the rally then further gains target $1.32.

A close below $1.30 would spell more short-term weakness, and would suggest that another attempt to break above $1.32 has failed.

USD/JPY heads back to ¥105.00

For now, USD/JPY appears to have found a floor at ¥101.20, and while the overnight bounce stalled at ¥105.00, there are signs of further buying pressure that may carry the price higher.

But the downtrend needs to be broken with a move above ¥106.00, otherwise a fresh drop towards ¥102.00 seems a possibility.

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