EUR/USD and GBP/USD break higher, while USD/JPY risks bearish reversal
Weak jobs numbers hurt the dollar, with EUR/USD and GBP/USD breaking higher while USD/JPY risks reversing lower.
EUR/USD surges through resistance after weak jobs number
EUR/USD has managed to push up into a two-month high following a massive miss on Friday's US non-farm payrolls figure. That came off the back of a retracement into the previous resistance level of $1.199. Crucially, this provides a bullish continuation signal, with the price rising up through the 76.4% Fibonacci resistance level once again.
With that in mind, there is a strong chance we are on our way to breaking up through $1.2243 to provide a wider bullish reversal signal. Nevertheless, there is a good chance of a near-term pullback, with the stochastic rolling over. As such, a short-term decline would look to provide a potential buying opportunity unless the price breaks below $1.199.
GBP/USD breaks from consolidation phase
GBP/USD has managed to break through $1.4006 resistance over the weekend, bringing an end to a phase of consolidation that has lasted the entirety of March and April. That breakout was largely expected, yet the jobs report certainly helped things along.
The result of that break is that we now look towards $1.4241 as the next major hurdle to overcome. Much like EUR/USD, there is a risk of a pullback before long, but a bullish outlook holds unless the price breaks back below the $1.3857 swing low. Until then, further upside looks likely as we see the long-term bull trend come back into play.
USD/JPY likely to weaken again despite early rebound
USD/JPY is on the rise as we kick off a new week, with the pair pushing into the 61.8% Fibonacci level at ¥109.04. Crucially, the breakdown seen on Friday appeared to bring about the beginning of another bearish phase following a rise into the wider 61.8% Fibonacci level at ¥109.63.
The decline from that resistance level points towards a potential period of weakness coming into play. However, with the price rising this morning, the key question is whether we see the bears come back into play once again from here. As such, a bearish outlook holds unless we see the ¥109.49 swing high taken out. Watch out for the bears to potentially come back into prominence between the 61.8% and 76.4% Fibonacci retracement levels (¥109.05-¥109.21).
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