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EUR/USD, GBP/USD, and USD/JPY recovering from recent pullback

EUR/USD, GBP/USD, and USD/JPY push higher following period of short-term declines.

Transcript

EUR/USD attempts to steady itself after latest decline

EUR/USD has been attempting to stabilize itself after yet another phase of weakness that led the pair into a fresh four-month low. The recent decline has taken us into the 76.4% Fibonacci support level at $1.1778, raising questions over whether this could be the beginning of a more protracted move higher.

Thus, we are in fact at a crossroad of a longer-term uptrend and a multi-month downtrend. As such, watch out for a potential rebound over the near term, although we would ultimately need to see a move through $1.1602 or $1.199 to tell us whether we end the wider uptrend or break this recent decline.

GBP/USD on the rise after latest move lower

GBP/USD is on the rise in early trade, with the pair attempting to regain ground following a pullback in the early part of last week. That recent pullback took us into the 76.4% Fibonacci level, raising a smaller scale example of what we are seeing in EUR/USD.

A break below $1.3566 brings a wider bearish picture into play, while a rise through the $1.4006 ends this recent bearish trajectory to resume the long-term uptrend. For now, the mid-sized rebound points towards the potential for a deeper move even if this is only a retracement phase as the dollar bulls take a breather.

USD/JPY pullback finds support on previous breakout level

USD/JPY managed to break through ¥109.36 resistance on Friday, with the pair hitting a fresh nine-month high in the process.

Notably, that rally ended at the key ¥109.85 peak from June 2020. While the pair has pulled back from that resistance level, we have seen 109.36 hold up as new support. As such, there is a good chance we see further upside from here in a bid to continue the uptrend seen over the course of 2021 thus far. A break back below the ¥108.34 low would be required to negate this bullish trend.

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