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​EUR/USD mixed, GBP/USD recovers while USD/JPY trades near seven-month high

​​Outlook on EUR/USD, GBP/USD and USD/JPY as German Ifo business climate disappoints and central banks except the BoJ remain hawkish.

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​​​EUR/USD tries to hold after two-day loss

​​At the end of last week EUR/USD fell back from its six-week high at $1.1012 amid weak Eurozone flash purchasing managers indices (PMIs) with it dropping to $1.0845.

​This week the cross began on a more positive footing above the 55-day simple moving average (SMA) at $1.0886 which is back in sight due to a weaker-than-expected German Ifo business climate reading for May. While it holds, though, the breached June uptrend line at $1.0943 remains a possible upside target, together with the $1.097 mid-June high.

​Support below last week’s trough at $1.0845 is seen around the 22 May high at $1.0832 below which lies the $1.08 region.

EUR/USD chart Source: IT-Finance.com
EUR/USD chart Source: IT-Finance.com

​GBP/USD bounces off support

​Last week GBP/USD slid to $1.2687 despite the Bank of England (BoE) raising its rates by 50 basis points (bps) for a 13th time to 5.00% as investors worried about the impact these hikes might have on the UK economy.

​While $1.2687 underpins, the medium-term uptrend may continue, though, with the 16 June low at $1.2768 representing the first upside target. Further up sits key resistance at last week’s $1.2841 to $1.2848 highs.

​If last week’s low at $1.2687 were to be slipped through, the $1.2679 May peak may offer support. If not, a drop back towards the $1.2599 to $1.2544 early-to-mid-June highs could ensue.

GBP/USD chart Source: IT-Finance.com
GBP/USD chart Source: IT-Finance.com

USD/JPY trades in seven-month highs

​The USD/JPY advance is ongoing amid a hawkish Federal Reserve (Fed) and a ultra-dovish Bank of Japan (BoJ) with the ¥145.00 region remaining in sight.

​Minor support below Friday’s ¥142.69 low can be spotted at the late November 2022 peak at ¥142.25.

Below it lies last week’s low at ¥141.22 and the ¥140.93 May peak.

USD/JPY chart Source: IT-Finance.com
USD/JPY chart Source: IT-Finance.com

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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