EUR/USD, EUR/GBP and GBP/USD slide ahead of weekend
Outlook on EUR/USD, EUR/GBP and GBP/USD as volatile week comes to a close.
EUR/USD reverses as US Treasury Secretary Janet Yellen’s clarifies her position
EUR/USD's near 3% rally came to a halt at $1.0929 on Thursday as US Treasury Secretary Janet Yellen spoke for the fourth time in a week but this time made it clearer than before that further comprehensive guarantees for uninsured deposits would come in the form of rescues for depositors of individual failing banks in order to prevent a bank run elsewhere.
Many market players saw her comments as possibly pointing towards the US treasury being aware of further banks on the brink of collapse, leading to flight-to-safety flows into the US dollar and pushing EUR/USD lower.
The cross is in the process of slipping through its accelerated mid-March uptrend line at $1.0795 with the 15 March high at $1.076 representing its first potential support level ahead of the 55-day simple moving average (SMA) at $1.0736 and the early-March high at $1.0695. Minor resistance can be spotted between Thursday’s low at $1.0825 and Friday’s intraday high at $1.0837.
EUR/GBP comes off its £0.8865 Thursday high on stronger-than-expected UK retail sales
EUR/GBP's strong rally earlier this week to Thursday’s £0.8865 high has been followed by the currency pair sliding again as UK retail sales surprised to the upside and came in at 1.2% month-on-month (MoM) in February versus an upwardly revised 0.9% rise in January and an expected gain of 0.2%.
The 22 February low at £0.8784 may offer short-term support, below which the February low can be spotted at £0.8755.
Resistance now comes in along the 55-day SMA at £0.8834 and at the 15 March high at £0.8843.
GBP/USD drops out of uptrend channel despite strong UK retail sales data
GBP/USD's advance stalled at Thursday’s $1.2343 high with it dropping out of its one-month uptrend channel despite the publication of better-than-expected UK retail sales data.
The 14 March high at $1.2204 represents a possible short-term support level ahead of the 55-day SMA at $1.2153.
Only the re-integration of the uptrend channel and rise above Friday’s intraday high at $1.2288 would likely lead to this week’s high at $1.2343 being bettered with the December and January highs at $1.2446 to $1.2448 then being in focus.
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