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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

EUR/USD, GBP/USD and USD/JPY slide on stronger greenback and falling Japanese inflation

​​Outlook on EUR/USD, GBP/USD and USD/JPY amid a stronger greenback and solid Japan data.

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​​​EUR/USD continues to be side-lined

EUR/USD's retracement lower from its 13-month high at $1.1075, due to a strengthening US dollar (USD) amid a US “rates higher for longer” scenario, has so far taken it to this week’s low at $1.091, above which it has been range trading since the beginning of the week.

A slip through Monday’s $1.091 low would eye the $1.0832 to $1.0804 mid-February and 10 April lows which are likely to act as significant support.

​Minor resistance above Wednesday and Thursday’s $1.0984 to $1.0989 highs sits along the minor psychological $1.10 mark with further resistance found at the $1.1033 February peak. Still further up lies last week’s peak at $1.1075, ahead of the January 2022 low and early-March 2022 high at $1.1121 to $1.1122.

EUR/USD chart Source: IT-Finance.com
EUR/USD chart Source: IT-Finance.com

​GBP/USD is likely to further come off its ten-month high

GBP/USD​’s climb down from its ten-month $1.2546 high, made marginally above the early-April high at $1.2525, amid a stronger greenback, has so far taken it to this week’s low at $1.2354 which is once again being eyed.

​Were this level and the next lower 10 April low at $1.2345 to be fallen through, a significant top would likely be formed with the mid-February high and early-April low at $1.2275 to $1.227 being targeted.

​As long as the $1.2354 to $1.2345 area holds, though, the medium-term uptrend remains intact. Minor resistance now comes in at Wednesday’s $1.2474 high above which lies more significant resistance between $1.2525 to $1.2546. These levels would need to be exceeded for the next higher May 2022 peak at $1.2667 to be back in the frame.

GBP/USD chart Source: IT-Finance.com
GBP/USD chart Source: IT-Finance.com

​USD/JPY gives back some of its recent gains

USD/JPY’s rise from its early-April low at ¥130.64 has taken the currency pair to this week’s high at ¥135.13 before stalling and sliding back towards the 55-day simple moving average (SMA) at ¥133.53 as the Japanese inflation rate edges down to a six-month low.

​The annual inflation rate slid to 3.2% in March compared to its 3.3% reading in February and helped the Japanese Yen (JPY) recover, together with Japan manufacturing purchasing managers’ index (PMI) which rose to a six-month high.

​Below the 55-day SMA there is no support to speak of until the mid-April low at ¥132.03. Good resistance can be seen between the 15 March and this week’s highs at ¥135.11 to ¥135.13.

USD/JPY Source: IT-Finance.com
USD/JPY Source: IT-Finance.com

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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