EUR/USD and GBP/USD aim to recover as USD/JPY risks new turn lower
Yesterday’s dollar strength has eased off slightly, allowing GBP/USD in particular to make early gains.
EUR/USD steadies after recent losses
The three-day move lower has seen EUR/USD break through two rising trendlines, but as the dollar bounce eases the pullback in EUR/USD has slowed as well.
Two days of lower highs and lows, following on from Thursday’s drop, suggested the sellers were in charge, but this brief pullback could end if the price manages to hold above yesterday’s low at $1.213 and then pushes back above $1.218.
GBP/USD rallies off Monday’s low
GBP/USD has already begun to show signs of strength, recovering to move back above $1.35.
Support at $1.347 held and allowed the price to edge higher, suggesting that an attempt to recover and break the past week’s series of lower daily highs is now underway. A reversal back below $1.345 would negate this view.
USD/JPY sees gains stall above 50-day SMA
Like so many rallies before it, the USD/JPY has reached and pierced the 50-day simple moving average (SMA) of ¥104.00. However, it has been unable to hold on to most of the gains made above this level.
A reversal below the 50-day SMA would suggest that a new leg lower is underway, following the creation of a lower high. This could bring the January low of ¥102.60 back into view.
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