EUR/USD, GBP/USD and NZD/USD reach key support zones
A mixed bag for EUR/USD, GBP/USD and NZD/USD as traders await the next big shift in risk sentiment.
EUR/USD starts to regain footing after declines
EUR/USD managed to break through the $1.0875 resistance level yesterday, bringing about an end to the recent trend of lower highs. That points towards further upside from here, with the current weakness providing a possible short-term pullback before we head higher once again.
Ultimately, this pair has a distinct lack of direction over the past two months, with the price failing to make a meaningful break from this consolidation phase. As such, it makes sense to simply trade both ups and downs when they are presented to us. As such, the short-term outlook is bullish unless we see a break below $1.0784.
GBP/USD starts to rise after GDP release
GBP/USD has seem limited upside off the back of this morning’s economic figures, despite beating expectations across the board. The recent trend of lower highs and lows looks set to continue given the break below $1.2266 support, with a rally through $1.2467 required to break from this bearish outlook.
Nevertheless, looking at price action over the past two months, we remain within a consolidation zone that points towards a potential bullish reversal from the $1.2195-$1.2266 zone. Until that is overcome, any bearish sentiment should be tempered by the possibility that we remain within this consolidation zone.
NZD/USD slumps into key support zone
NZD/USD has seen sharp losses overnight, following a Reserve Bank of New Zealand (RBNZ) decision to raise quantitative easing (QE) and leave the door open to further downside on interest rates. This has led NZD/USD into a notable area of support, with the $0.5995 swing low coupled with the lower end of a standard deviation channel.
A break below this zone would signal a potential bearish reversal coming into play. However, until that happens there is a good chance we will start to regain some ground from here given the importance of this level.
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