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Small gains for EUR/USD and GBP/USD: technical analysis

Powell’s speech yesterday did hit the dollar, but the greenback is firming up today, resulting in only limited upside for the likes of the euro and sterling.

EUR/USD bounce stalls

The EUR/USD pair has bounced from $1.112 over the past week, but rallies since late April have run out of steam around $1.126, and so far gains over the past three sessions have failed to hold above this level.

Further upside targets $1.13 and then on to $1.133, while a move back below $1.122 would raise the prospect of a return to $1.112.

Small gains for GBP/USD

GBP/USD has clawed its way higher over the past few days, with higher lows in place since the end of May.

Gains in late May stalled at $1.275, so this is the first area of resistance to watch for, followed on by the spike higher on 21 May to $1.2815. The short-term bullish view persists unless we see a move back below $1.264.

Bottoming action in USD/JPY

Price action here over the past few days suggests that a short-term bottom may have been formed for USD/JPY, but it is still a lower low as the pair continues its drop from the late April highs.

The price has stabilized around ¥108.00, so if this continues to hold then some upside may result, but ¥108.40 has provided resistance so far this week. Trendline resistance from the late April high would see the price run into a possible area of resistance around ¥109.50. A close below ¥107.80 would open the way to more downside.

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