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EUR/USD and GBP/USD stall while NZD/USD finds support ahead of US Q1 GDP

Outlook on EUR/USD, GBP/USD and NZD/USD ahead of preliminary US quarter one GDP release.

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​​​EUR/USD’s advance runs out of steam around the $1.1075 mid-April high

EUR/USD’s rally, on hawkish comments from European Central Bank (ECB) council members on Monday calling for a 50 basis point (bp) rate hike at the next committee meeting, was briefly extended to a 13-month high at $1.1095 on Wednesday before the cross gave back some of its recent gains ahead of Thursday’s preliminary US quarter one (Q1) gross domestic product (GDP) data.

​While the $1.1075 to $1.1095 zone caps, a slip back towards the psychological $1.10 mark and the March-to-April uptrend line at $1.0986 may unfold.

​As long as the next lower Tuesday low at $1.0965 holds on a daily chart closing basis, the January 2022 low and early-March 2022 high at $1.1121 to $1.1122 remain possible upside targets. Support below $1.0965 can be found at the $1.0929 late-March high and also at last week’s low at $1.091.

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

​GBP/USD struggles to make headway

GBP/USD’s attempt to reach its early-April high at $1.2525 faltered at Wednesday’s high at $1.2515 amid stronger-than-expected US manufactured durable goods orders which rose by 3.2% in April compared to a month ago. Further range trading below the currency pair’s ten-month high at $1.2546 thus remains at hand.

​The $1.2525 to $1.2546 current-April peaks would need to be exceeded for the next higher-May 2022 peak at $1.2667 to be in focus. Slips should find support along the March-to-April uptrend line at $1.2422. While the cross continues to be propped up by the next lower $1.2368 to $1.2345 mid- to late-April lows, further upside may eventually still be seen.

​Only if the $1.2345 level were to give way on a daily chart closing basis would a top be formed with the mid-February high and early-April low at $1.2275 to $1.227 as well as the 55-day simple moving average (SMA) at $1.2204 being back in view.

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

​NZD/USD tries to stabilise near March trough

NZD/USD has so far slid to $0.6112 as New Zealand business mood drops to a three-month low with the Australia and New Zealand Banking Group (ANZ) business outlook index slipping to -43.8 in April from -43.4 in the previous two months. The latest figure marked the 22nd straight month of negative readings.

​Nonetheless the cross is trying to find support slightly above its $0.6085 March low and attempts to heave itself back above the 200-day SMA at $0.6161, a rise above which and Tuesday’s high at $0.6187 would have short-term bullish implications and could lead to the 55-day SMA at $0.6217 being reached.

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