Skip to content

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

EUR/USD and EUR/JPY rally while EUR/GBP slides

​​Outlook on EUR/USD, EUR/GBP and EUR/JPY as Eurozone sinks into a recession.

JPY Source: Bloomberg

​​​EUR/USD continues to trade in a low volatility trading band

EUR/USD rallied on weaker-than-expected jobless claims in the US which led to hopes that the Federal Reserve (Fed) will opt to leave its hiking campaign on pause for longer and pushed the greenback lower.

​Last Friday’s high at $1.0779 has thus been exceeded with the 22 May high at $1.0831 representing a possible upside target for next week when both the Fed and European Central Bank (ECB) will have their monetary policy meetings.

​Potential support sits at the 30 May high at $1.0747 and at Tuesday’s $1.0733 high.

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

​EUR/GBP slips back to its five-month low at £0.8568 as Eurozone enters a recession

​EUR/GBP’s slide to levels last traded in December of last year, to last week’s £0.8568 low, happens as the Eurozone has entered a technical recession. Gross domestic product (GDP) fell by a revised 0.1% in the first quarter (Q1) of 2023 and the final three months of 2022, showing two consecutive quarters of negative growth.

​Major support remains to be seen between the September-to-December lows at £0.8572 to £0.8548 and may hold once more. If not, the £0.85 mark would be next in sight.

​Immediate downside pressure should be maintained while Thursday’s high at £0.8614 isn’t overcome.

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

UR/JPY resumes its ascent

​EUR/JPY’s rise above Monday’s ¥150.20 high points towards a resumption of the currency pair’s uptrend despite the Eurozone sinking into a recession. ​The move higher is probably driven by further ECB rate hike expectations while the Bank of Japan (BoJ) pursues its ultra-loose monetary policy stance.

​The May-to-June resistance line at ¥150.82 represents the first upside target. If overcome, the early and late-May highs at ¥151.07 to ¥151.61 will be in view.

​This bullish forecast will remain valid as long as the current June lows at ¥148.64 to ¥148.60 hold on a daily chart closing basis.

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

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Find out more

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Monday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

You might be interested in…

<h3>How much does trading cost?</h3>
<h3>Find out about IG</h3>
<h3>Plan your trading</h3>

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.