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EUR/USD and GBP/USD edge up while USD/JPY falters at ¥145.00 again

A pause in the dollar rally sees USD/JPY stuck below recent highs, but both the euro and sterling have made gains in early trading against the greenback.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 04 October 2022 

EUR/USD rebound continues

After falling to a twenty-year low last month, the euro continues to rebound against the US dollar with EUR/USD.

This still looks very much like a counter-trend bounce that sees the price head back to the 50-day simple moving average (SMA), currently $1.1018 and then begins to falter. This would be in line with previous bounces since April, all of which have found it impossible to hold above the 50-day SMA.

This move could see the price head back to $1.01. Further targets lie at $1.02 and then $1.0374.

EUR/USD chartSource: ProRealTime

GBP/USD recovers $1.13

The GBP/USD continues to defy the doomsters with a recovery above $1.13. Its own counter-trend bounce remains intact, and if previous bounces are any guide there is still some potential for upside, even if it only reaches the 50-day SMA.

Like EUR/USD, the pound is still making lower highs and lower lows against the dollar, with the previous peak at $1.176 marking out the initial target for this bounce.

Both stochastics and moving average convergence/divergence (MACD) have room to move up to support this move, but selling the rallies still appears to be the approach here for this downtrending market, although it looks like for now there is still a desire to push the pair higher in the short-term.

GBP/USD chartSource: ProRealTime

USD/JPY stalls below ¥145.00

It does look like ¥145.00 is the ceiling in USD/JPY for the time being – repeated attempts to break higher have come to naught, despite the continued strength of the US dollar.

Indeed, it is perhaps precisely that we need a pullback in order for the trend to revive. The pair rallied hard from the August-lows, and now sits at some distance from the 50-day SMA (currently ¥139.15).

A pullback towards this level might ‘clear the air’, create a higher low and provide a springboard for fresh bullish momentum.

USD/JPY chartSource: ProRealTime
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EUR/USD, GBP/USD and NZD/USD rebound likely to prove shortlived

EUR/USD, GBP/USD and NZD/USD gain ground, but dollar dominance looks likely to soon return.

 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 05 October 2022 

EUR/USD rallies up towards trendline and Fibonacci resistance

EUR/USD has enjoyed a period of respite from the incessant selling pressure that dominated much of September. However, October appears to be more generous to EUR/USD, with the pair regaining ground for much of this week. That optimism is likely to be short-lived, with the price rising into the confluence of trendline and Fibonacci resistance (76.4% at $1.0041).

The wider bearish trend seen throughout this year has followed a very distinct pattern, with the price typically returning to this trendline time and time again after each leg lower. With the troubles of the world far from resolved, it is likely that we will see the price reverse lower from this deep retracement. As such, a bearish view holds unless we see the price rise through the recent swing high of $1.0198.

EUR/USD chartSource: ProRealTime

GBP/USD rebounds back into a key resistance zone

GBP/USD has seen plenty of volatility since Kwasi Kwarteng announced his mini-budget, with an initial capitulation giving way to a recovery period that has taken the pair up through the previous support level of $1.1411. Unlike EUR/USD, we do not have a perfect trendline, but ultimately the bearish trend does remain intact.

Meanwhile, the stochastic oscillator has pushed up into overbought territory, with a move back below the 80 threshold bringing a bearish signal that has proven a good selling opportunity on each other occasion it has occurred this year. A break up through the $1.277 level would bring a wider bullish reversal signal. However, until that happens, there is a good chance that the dollar comes back into prominence, thus sending the pair lower once again.

GBP/USD chartSource: ProRealTime

NZD/USD gains prove shortlived after rate hike

NZD/USD has been attempting to regain ground over the course of this week, with the overnight 50-basis point (bp) rate hike from the Reserve Bank of New Zealand (RBNZ) providing yet another push higher. However, with the Reserve Bank of Australia (RBA) and RBNZ expected to be slowing their tightening phase, we have seen a significantly less convincing rebound for the NZD and AUD.

This is highlighted below, with the gains seen earlier today already fading. In any case, the recovery phase we have recently been seeing does look likely to represent a retracement before the bears return to prominence. That bearish outlook remains in play unless the price rises through the $0.6161 swing high.

NZD/USD chartSource: ProRealTime
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GBP/USD and EUR/USD come off their recent highs while EUR/GBP consolidates

Outlook on EUR/USD, EUR/GBP and GBP/USD as they consolidate post European PMI data.

 

 Axel Rudolph | Market Analyst, London | Publication date: Thursday 06 October 2022 

EUR/USD consolidates below parity

EUR/USD’s near 5% rally from its $0.9536 fresh 20-year September low faltered just below parity amid weaker than expected Eurozone purchasing managers index (PMI) data which continues to point towards a possible recession.

The cross thus slid back to its two-week support line and may soon revisit the $0.9855 late September high. Further down minor support can be found around the $0.98 mark and also at the 3 October low at $0.9753.

In case of the minor support line holding, parity may be revisited. Slightly above it the 55-day simple moving average (SMA) and the February-to-October downtrend line can be spotted at $1.0025 to $1.0038 and are likely to cap the upside this week.

EUR/USD chartSource: IT-Finance.com

EUR/GBP consolidates post weak Eurozone PMI data

EUR/GBP has been trading in a less volatile fashion than last week when it shot up to its £0.9283 two-year high on the back of the UK’s mini budget which introduced the biggest tax cuts in 50 years.

Following the government’s partial U-turn on Monday, EUR/GBP slid to this week’s low at £0.8649 before consolidating amid weak Eurozone PMI data and while awaiting UK construction PMI data.

Further sideways trading seems to be at hand with minor resistance sitting at the £0.8787 mid-September high. If overcome, the 26 and 28 September lows at £0.8853 would be next in line. Below the recent low at £0.8649 lies the mid-September low at £0.8626 and the 55-day SMA and early September low at £0.8587 to £0.8567.

EUR/GBPSource: IT-Finance.com

GBP/USD consolidates below this week’s high made close to $1.15

GBP/USD’s 11% rally from its all-time low at $1.035 following the UK governments largest, by some seen as unfunded, tax cuts in 50 years, seems to have stalled marginally below the $1.15 mark.

Monday morning’s U-turn on the abolishment of the UK higher earners 45p tax rate cuts, only saving of around £2 billion out of a £45 billion fiscal loosening programme, and Wednesday’s decision by the Chancellor of the Exchequer Kwasi Kwarteng to freeze tax thresholds, which in three years’ time will deliver an extra £41 billion amid high inflation and rising wages, have not helped the pound which has so far slid back to $1.1228.

GBP/USD now trades below minor technical resistance seen between the 7 and 16 September lows at $1.1351 to $1.1406 while immediate support below $1.1228 can be found along the two-week support line at $1.1178.

GBP/USDSource: IT-Finance.com
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EUR/USD, GBP/USD and AUD/USD reverse lower after recent rebound

EUR/USD, GBP/USD and AUD/USD reverse lower as the dollar comes back into prominence.

USDSource: Bloomberg
 
 Joshua Mahony | Senior Market Analyst, London | Publication date: Friday 07 October 2022 

EUR/USD rolling over as dollar starts to come back into strength

EUR/USD has been on the back foot since the Tuesday rise into parity, with the bears coming back into prominence as markets start to roll over once again. The long-term trajectory evident over the course of this year brings a clear bearish bias, and thus the weakness we are seeing from here plays into that negative view. Meanwhile, commentary from the Federal Reserve (Fed) members highlight the expectation that they will continue to remain steadfast on their push to drive down inflation via rate increases.

Today brings a fresh update from the US jobs market, with traders keeping a close eye out for any pick up in earnings growth and unemployment. With the dollar coming back into prominence, the bearish trend is expected to continue here, with the wider downtrend on broken in the event that the price breaks up through the $1.0198 swing high. Until then, bearish trades are favoured, with the price expected to continue this downward trajectory as we move forward.

EUR/USD chartSource: ProRealTime

GBP/USD starts to weaken after period of strength

GBP/USD is also on the back foot as we head towards the weekend, with dollar dominance once again looking likely to take hold. The recovery of the post-budget slump has provided some relief from feelings that the pair could be in freefall on concerns of fiscal stability. However, irrespective of the impact played by the budget, the wider bearish trajectory remains in play as traders prefer the haven dollar.

With that in mind, another leg lower is favoured here, with the bearish reversal in the stochastics giving us a fresh sell signal after moving below the 80 threshold. This bearish outlook holds unless we see the price rise through the $1.2277 level.

GBP/USD chartSource: ProRealTime

AUD/USD heads lower, with the price closing in on two-year low

AUD/USD has lagged many of its peers of late, with the price failing to provide the kind of rebound we have seen for EUR/USD and GBP/USD last week. With the Reserve Bank of Australia (RBA) having raised rates by just 25 basis points (bp) this week, it is clear that the pace of tightening in Australia is significantly less rapid than at the Federal Open Market Committee (FOMC). We are now seeing the pair head lower, with the price approaching the $0.6363 low established last Wednesday.

A break below that level would provide a fresh sell signal, with stops subsequently placed above the recent retracement high of $0.6547. As such, for today the key question is whether we see the price break that 0.6363 low to set a fresh two-year low.

AUD/USD chartSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD head lower after recent retracement

EUR/USD, GBP/USD and AUD/USD expected to head lower as wider trend kicks in once again.

 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 10 October 2022 

EUR/USD continuing its decline after recent upward retracement

EUR/USD has kicked off the week with a similar bearish tone to that seen on the back end of last week. Declines seen throughout the indices space has brought renewed demand for the dollar, which rather predictably brings a bearish continuation of this pair.

From this daily chart we can see the pattern of lower highs, with the recent rally taking us within close proximity to trendline resistance once again. A break up through the $1.0198 swing high would bring about a more positive outlook, with bearish positions favoured until such a move occurs. With the price instead turning lower, the bearish trend holds, with further downside expected from here.

EUR/USD chartSource: ProRealTime

GBP/USD rolling over from trendline resistance

GBP/USD has similarly been rolling over after a period of gains that took the price back up into trendline resistance. The long-term downtrend remains in place despite the recent period of upside, with the failure to rise through $1.1738 bringing expectations of another leg lower here. Crucially, we have also seen the stochastic roll over from overbought territory, highlighting the shift in momentum to favour the bears.

Looking back over the course of the year thus far, we have seen the stochastic move back out of the overbought zone three times, each of which provided a timely signal of impending downside. This appears to be another one. As such, short positions are favoured here, with a rise up through the $1.1738 level required to negate that view.

GBP/USD chartSource: ProRealTime

AUD/USD tumbles into two-year low in early trade

AUD/USD is wasting no time getting going this week, with the pair slumping into a two-year low in early trade today. A weekend collapse in the Caixin services purchasing managers index (PMI) out of China did provide a worrying signal, with the impressive August figure of 54.5 collapsing into a contractionary 49.3 reading for September.

Understandably, the notion of a Chinese crisis brings fear for the Australian economy. From a charting perspective, this latest decline brings the beginning of the next leg lower, with the latest rebound proving minimal compared to the moves for the European currencies. The creation of a lower low thus continues the downtrend, with bearish positions favoured unless the price rises through the recent swing-high of $0.6547.

AUD/USDSource: ProRealTime
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Dollar strength boosts USD/JPY, while hitting EUR/USD and GBP/USD again

Renewed strength in the dollar has boosted USD/JPY, but the euro and sterling continue to struggle against the greenback.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 11 October 2022

EUR/USD retreat from lower high goes on

The 50-day simple moving (SMA) continues to act as a powerful barrier to any upward progress for EUR/USD.

The pair had rebounded from the September low, and seemed set to test parity, but the resurgence of the US dollar last week has meant that, once again, a lower high has been created, and the pair is now heading back to those September lows below $0.96.

Selling the rallies continues to be the approach here, and the sellers are firmly back in charge after the latest brief bounce.

EUR/USD chartSource: ProRealTime

GBP/USD eats away at September rebound

Sterling’s latest bounce against the dollar appears to be well and truly over, and GBP/USD is again making progress in the direction of parity.

The slump and rebound to September lows was more extreme here than for EUR/USD, but the general outlook remains the same.

After rallying to just below $1.15, the pair has turned lower once again. A reviving US dollar has resulted in the creation of a lower high and a reaffirmation of the downtrend. Any bullish view for the near term has been cancelled out following the reversal of last week.

Additional declines will see the price head back towards $1.05 and lower, the record lows for the pair.

GBP/USD chartSource: ProRealTime

USD/JPY pushes on above ¥145.00

Last week’s non-farm payroll report provided USD/JPY with the catalyst to move on above ¥145.00, although it has been a rather circumspect move.

Nonetheless the pair has created a new higher high, with ¥146.75 the next target to watch to the upside. We have seen the uptrend revive in recent sessions, and the consolidation of mid-September has given way to further gains.

USD/JPY chartSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD expected to bring further downside

EUR/USD, GBP/USD and AUD/USD remain within a intraday downtrend, with a near term consolidation likely to resolve in another leg lower.

 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 12 October 2022 

EUR/USD starts to stabilize, showing potential for near-term rebound

EUR/USD has been on the back foot since rising into a deep retracement that took the price back towards the descending trendline of 2022. Yesterday saw that decline halted, with the daily candle showing some indecision creeping in. While that highlights the potential for a near-term rebound in this pair, it would make sense to await a rise through $0.9774 to start looking out for a short-term rebound back towards trendline resistance.

However, even if we did see such a near-term move, it would likely simply provide another lower high before the price turns lower once again.

As such, the bearish intraday trend remains in play unless the price rises through $0.9774, with such a break providing a potential temporary upside move. Until then, further downside looks likely as the dollar dominates.

EUR/USD chartSource: ProRealTime

GBP/USD with slow start as GDP heads south

GBP/USD has also paused its decline as things stand, with markets weighing up the consequences of a potential extension to Bank of England (BoE) support, and a surprise 0.3% contraction in UK gross domestic product (GDP).

The BoE’s ability to keep the gilt markets orderly in a bid to stave off a crisis in the pension industry will be key here, although comments out of the BoE signal an apparent commitment to end the bond buying scheme on Friday. In any case, we are evidently looking at a downward trending market that will likely resolve with another move lower before long.

While we have seen some upside this morning, it makes sense to wait for the price to surpass the $1.118 level to bring expectations of a short-term upside move here. Until then, another move lower looks likely.

GBP/USD chartSource: ProRealTime

AUD/USD remains on the back foot

AUD/USD continues to underperform, with the pair regularly reaching a new two-year lows.

With that Reserve Bank of Australia (RBA) slowing their tightening policy and China growth concerns growing, we are looking at a potential pair that looks likely to remain geared towards dollar strength.

A rise through the $0.6346 level would bring the potential for a near-term upwards retracement phase. However, until that happens it makes sense to expect more downside for this pair

AUD/USD chartSource: ProRealTime
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EUR/USD, GBP/USD and USD/JPY await US CPI data release

Outlook on EUR/USD, GBP/USD and USD/JPY ahead of US inflation data while the Japanese Yen is trading in new 24-year lows.

USD/JPYSource: Bloomberg
 
 Axel Rudolph | Market Analyst, London | Publication date: Thursday 13 October 2022 

EUR/USD consolidates around 97 cents ahead of US CPI data

EUR/USD has been consolidating in a tight, low volatility range around the 97 cents mark all of this week while awaiting US consumer price index (CPI) data out later today. Month-on-month CPI for September is expected to come in at 0.1% versus 0.2% in August and Core CPI – excluding food and energy – at 0.6% versus 0.4% previously. Year-on-year the data is anticipated to show 8.3% versus 8.1% in August.

Higher than expected inflation will probably be interpreted by the market as meaning that the Federal Reserve (Fed) will stick to its aggressive tightening path with the US dollar continuing its ascent and EUR/USD slipping back towards its $0.9536 September 20-year low.

Lower than expected CPI, especially if the data comes in much lower than forecast, would most likely lead to a short-term decline in the greenback and give the euro a boost, pushing the exchange rate back towards the $0.9865 to $0.9946 August-to-mid-September lows. Key resistance remains to be seen between the 55-day simple moving average (SMA), the February-to-October downtrend line, early-October high between $0.998 and parity.

EUR/USD chartSource: IT-Finance.com

GBP/USD stabilises ahead of US CPI data release

GBP/USD reached this week’s low at $1.0924 after five consecutive days of declines amid UK gilt yields surging towards their late-September post mini-budget peak after the Bank of England (BoE) governor said on Wednesday that pension funds had until Friday to fix their liquidity problems.

Despite UK industrial production falling by 1.8% month-on-month and 5.2% year-on-year in August, well below expectations of a 0.1% monthly contraction and a 0.6% annual expansion, GBP/USD managed to stabilise and even regain some of its recent losses. All eyes are on Thursday’s US CPI data, especially after Wednesday’s hotter-than-expected US producer price inflation data.

A higher-than-expected CPI reading would likely lead to renewed US dollar strength, pushing GBP/USD back to Wednesday’s low at $1.0924, a slip through which would engage the 27 September high at $1.0838 and the $1.08 region. If a significantly lower reading of the CPI data were to be seen, Tuesday’s high at $1.1180 would be expected to be taken out with the August-to-October downtrend line at $1.1378 being targeted.

GBP/USD chartSource: IT-Finance.com

USD/JPY trades in 24-year lows ahead of US CPI data

USD/JPY continues to surge higher and trades in 24-year highs whilst approaching the August 1998 high at ¥147.64 ahead of US CPI data and as the Bank of Japan (BoJ) sticks to its dovish stance.

Its governor, Haruhiko Kuroda, vowed to keep ultra-easy monetary policy to support Japan’s economic recovery and stressed the need to achieve the 2% inflation target in a sustainable and stable manner, thus pushing the Japanese Yen to a new multi-decade low.

A rise above the 1998 peak at ¥147.64 would put the June 1989 high at ¥150.33 on the map. Slips should find support between the monetary intervention September highs at ¥145.90 to ¥144.99 as well as along the August-to-October uptrend line at ¥144.62.

USD/JPY chartSource: IT-Finance.com
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EUR/USD, GBP/USD and AUD/USD rebound unlikely to last

EUR/USD, GBP/USD and AUD/USD see near-term gains after a volatile US CPI reading, but wider bearish trends point towards potential bearish reversals before long.

 Joshua Mahony | Senior Market Analyst, London | Publication date: Friday 14 October 2022 

EUR/USD volatility resolves in a push higher

EUR/USD has started to reverse upwards after a day of major volatility which saw US core inflation reach a 40-year high of 6.6%. Nonetheless, while we initially saw the price drop back into the 76.4% Fibonacci support level, we have resolved with a risk-on move that is driving EUR/USD upwards.

Crucially, that move has brought the price up through the $0.9774 resistance level, ending the intraday trend of lower highs. Subsequently, we turn towards the wider trend, with a descending trendline built over the course of 2022 providing a potential upside target.

With the ongoing pattern of lower highs evident here, short-term upside looks to provide a potential selling opportunity. That view would be negated with a push up through the trendline and $1.00 handle. Potential points of reversal are provided by the Fibonacci tool, with $0.9815, $0.9859 and $0.9913 in view.

 

EUR/USD chartSource: ProRealTime

GBP/USD rebound takes the price back into trendline resistance

GBP/USD has been on the rise since yesterday’s consumer price index (CPI) fuelled volatility, with the price rising back towards a key confluence of resistance. The descending trendline and 76.4% Fibonacci resistance level point towards a potential swift bearish reversal if the ongoing trend of lower highs is to continue.

With Kwasi Kwarteng expected to return to the UK early to discuss further potential budget U-turns, we may yet see another boost for the pound.

Nonetheless, unless the price rises through the $1.1495 swing high, there is a good chance that the price soon reverses downwards to continue the trend of lower highs evident over recent months.

GBP/USD chartSource: ProRealTime

AUD/USD rallies into key resistance zone

AUD/USD similarly found a bid yesterday, with soaring underlying inflation in the US signalling a likely continuation of the Federal Reserve (Fed) tightening planned over the coming months. Meanwhile, the latest 25-basis point (bp) hike from the Reserve Bank of Australia (RBA) signal a far slower pace of tightening in Australia.

This explains the relative underperformance we are seeing here, with the price still far from the major swing high of $0.6547. Instead, we have seen the price rise back into the intraday swing high of $0.6346, which also tallies up with the late-September low of $0.6363.

A break up through that zone of resistance would bring a wider rebound into play. However, until that happens, there is a good chance we see the price reverse lower from this resistance zone.

AUD/USD chartSource: ProRealTime
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EUR/GBP, GBP/USD and EUR/USD await new UK chancellor’s statement

Fundamental commentary and technical analysis on EUR/USD, GBP/USD and EUR/GBP.

 

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Monday 17 October 2022

EUR/USD consolidates around 97 cents ahead of German ZEW economic sentiment

EUR/USD is seen consolidating around the 97 cent mark, having last week shot up from its $0.9632 low to its $0.9808 high amid stronger-than-expected US consumer price index (CPI) data. The currency pair awaits the October ZEW economic sentiment data in Germany on Tuesday which is expected to come in at -61.2 versus -60.7 in the previous month.

Minor support comes in around the 97 cents zone and also at the one-month support line at $0.9648. Below it, lies last week’s low at $0.9632. A rise above last week’s high at $0.9808 would put the $0.9865 to $0.9946 August-to-mid-September lows back on the plate. Key resistance remains to be seen between the 55-day simple moving average (SMA), the February-to-October downtrend line, early-October high between $0.9963 and parity.

EUR/USD chartSource: IT-Finance.com

 

EUR/GBP consolidates ahead of new UK chancellor’s statement

EUR/GBPcontinues to trade along the 55-day SMA at £0.8649 as traders await the new UK chancellor of the exchequer, Jeremy Hunt’s, statement about his fiscal policy. It is widely expected that a number of tax rises will be brought forward and planned tax cuts pushed back as he looks to shore up the UK's fiscal position which led to buying in the pound sterling.

Thus, last week’s low at £0.861 may be revisited, a slip through which would engage the early-September low at £0.8567. Further sideways trading with a slight bearish slant seems to be at hand with minor resistance sitting between the one-month downtrend line and the mid-September high at £0.8764 to £0.8787. If overcome, the 26 and 28 September lows at £0.8853 would be next in line.

EUR/GBP chartSource: IT-Finance.com

GBP/USD gains ground ahead of Jeremy Hunt statement

Last week, GBP/USD rallied back to its August-to-October downtrend line at $1.138 which capped before the cross came off again.

The Friday lunchtime news that the new UK prime minister - Liz Truss - had sacked her chancellor of the exchequer, Kwasi Kwarteng, after only 39 days in office, only the second shortest stint since Ian MacLeod in 1970 when he died only a month after taking office, and replaced him with the experienced former culture, health and foreign secretary Jeremy Hunt led to a slip in the pound sterling. Perhaps the reason for the initial GBP/USD slide was that Mr Hunt supported the prime minister’s rival Rishi Sunak in the Tory leadership battle.

This week has kicked off with a stronger GBP/USD exchange rate, however, since the market expects several promised tax cuts to be rolled back or delayed whereas some tax rises will be brought forward as the new chancellor looks to calm financial markets and shore up the UK’s fiscal position. Thus, the three-month downtrend line at $1.1336 may be revisited, but only a rise above last week’s high at $1.138 would put the early-October peak at $1.1495 back on the map. Slips should find initial support around the 11 October high at $1,118 and then along the one-month support line at $1.1074.

GBP/USD chartSource: IT-Finance.com
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EUR/USD and USD/JPY push higher while GBP/USD recovery stalls

While both EUR/USD and USD/JPY are moving up, the pound’s bounce against the dollar has stalled.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 18 October 2022

EUR/USD edges towards 50-day SMA

EUR/USD continues to recover from last week’s lows, pushing back towards the 50-day simple moving average (SMA) after it managed to establish a higher low.

But the 50-day SMA has been a major barrier in the current downtrend, and we may see fresh selling pressure develop around the indicator, creating yet another lower high.

This would revive the existing downtrend and bring the $0.963 and $0.954 levels into play as potential downside targets. A move back above $1.00 might provide some short-term relief, and open the way to $1.015.

EUR/USD chartSource: ProRealTme

GBP/USD holds above $1.13

The financial statement from the chancellor yesterday prompted a broad recovery in the pound with GBP/USD, though gains are beginning to falter as the price approached $1.14.

It is an open question whether the price can move above $1.15, which would put it back above the 50-day SMA for the first time in months.

Nonetheless, the downtrend is still in place, and it looks like we will see a fresh leg lower in due course. This would then bring $1.10 into view, followed up by the lows of September in time, to $1.05

GBP/USD chartSource: ProRealTime

USD/JPY hits yet another high

USD/JPY impressive rally shows no sign of slowing. Indeed the latest run of gains have resulted in the price reaching ¥149.00, a fresh multi-decade high.

The current leg higher in the broader uptrend looks to have further to run.

Having run higher since August, the risk now is perhaps a form of intervention by Japanese fiscal or monetary authorities, which might provide the catalyst for a fresh pullback towards the 50-day SMA.

USD/JPY chartSource: ProRealTime
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USD/JPY trades in fresh 32-year highs while EUR/USD and EUR/GBP consolidate

Fundamental commentary and technical analysis on USD/JPY, EUR/USD and EUR/GBP as greenback appreciates on expectations that US Fed will plough ahead with its aggressive tightening plans to combat soaring inflation.

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Wednesday 19 October 2022

EUR/USD consolidates amid stronger US dollar

EUR/USD’s recent surge higher is taking a breather as the US dollar rises on expectations that the US Federal Reserve (Fed) will plough ahead with its aggressive tightening plans to combat soaring inflation.

EUR/USD thus consolidates below Tuesday’s $0.9875 high and may slip back towards the 11 October high at $0.9774 ahead of Thursday’s September German Producer Price Index (PPI) data release.

In case of the current consolidation phase being followed by renewed upside, a rise above $0.9875 could lead to the $0.9901 August low and also the $0.9946 to $0.9962 zone being reached. It consists of the mid-September low, 55-day simple moving average (SMA) and June-to-October downtrend line.

EUR/USD chartSource: IT-Finance.com

EUR/GBP consolidates amid 40-year high inflation

EUR/GBP is trying to break through its two-month downtrend line at £0.8694 as UK inflation comes in above expectations at 10.1% in September, matching its 40-year high from July, with upward pressure from food and energy.

Tuesday’s high at £0.8731 is thus back in the picture, a rise above which would push the £0.8787 mid-September high to the fore. If overcome, the 26 and 28 September lows at £0.8853 would be next in line.

Minor support below Wednesday’s £0.8681 intraday low comes in along the 55-day SMA at £0.8640. Below it lies the mid-September low at £0.8626 and the early September low at £0.8567.

EUR/GBP chartSource: IT-Finance.com

USD/JPY trades in 32-year highs ahead of Japanese trade balance data

USD/JPY continues to surge higher and trades in 32-year highs, having risen above the August 1998 peak at ¥147.64. The cross is swiftly heading towards the psychological ¥150 mark ahead of Thursday’s Japanese trade balance data as the Bank of Japan (BoJ) sticks to its dovish stance.

Its governor Haruhiko Kuroda recently vowed to keep ultra-easy monetary policy to support Japan’s economic recovery and stressed the need to achieve the 2% inflation target in a sustainable and stable manner, thus pushing the Japanese Yen to a new multi-decade low.

A rise above the minor psychological ¥150 mark would put the June 1989 high at ¥150.33 on the map, unless the BoJ were to intervene once more as it did in September. Potential slips should find support at Tuesday’s ¥148.14 low. Much further down lies more significant support at the September intervention peak at ¥145.91.

 

USD/JPY chartSource: IT-Finance.com
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EUR/USD and GBP/USD slip on inflation woes while EUR/GBP range trades

Outlook on EUR/USD, GBP/USD and EUR/GBP as greenback rises on safe-haven flows due to soaring global inflation.

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Thursday 20 October 2022 

EUR/USD slips as US dollar rises on surging global bond yields

EUR/USD trades lower, back below the $0.98 mark, as the US dollar benefits from flight to quality flows following surging global yields as inflation continues to rise unabated.

EUR/USD’ sell-off Tuesday’s $0.9875 high has briefly taken the cross below the 11 October high at $0.9774 to Wednesday’s low at $0.9758, before recovering on Thursday morning’s September German Producer Price Index (PPI) better-than-expected data release. Month-on-month (MoM) September PPI came in lower-than-expected at 2.3% versus an expected 7.9%.

A slip through $0.9758 would eye the two-month support line at $0.9674, below which lies the mid-October low at $0.9632. Minor resistance sits at the $0.9854 to $0.9865 early-September low and late-September high. Only a rise above $0.9875 could lead to the $0.9901 August low and also the $0.9943 to $0.9962 area being back on the cards. It consists of the mid-September low, 55-day simple moving average (SMA) and June-to-October downtrend line.

EUR/USD chartSource: IT-Finance.com

EUR/GBP range trades in low volatility amid UK 40-year high inflation

EUR/GBP on Wednesday broke through its two-month downtrend line at £0.8658 as UK inflation came in above expectations at 10.1% in September, matching its 40-year high from July, with upward pressure from food and energy.

Since then, the cross has traded in a very tight range below Tuesday’s high at £0.8731. A rise above this level would put the £0.8787 mid-September high on the map. If bettered, the 26 and 28 September lows at £0.8853 would be eyed next.

Minor support below the breached downtrend line, Wednesday’s low and the 55-day SMA at £0.8658 to £0.8634 comes in at the mid-September low at £0.8626 with further support being seen at the early September trough at £0.8567.

EUR/GBP chartSource: IT-Finance.com

GBP/USD probes uptrend line on UK government chaos

GBP/USD slid back from its $1.138 mid-October high to its September-to-October uptrend line at $1.1218 among the UK government’s ongoing chaos and 40-year high inflation. Following last week’s sacking and replacement of the Chancellor of the Exchequer, yesterday the Home Secretary resigned for breaching the ministerial code but did so by launching a stinging attack on the prime minister who has overseen several major U-turns in her government’s policy since taking office a month ago.

On Wednesday UK inflation came in above expectations at 10.1% in September, matching its 40-year high from July, with upward pressure from food and energy. This accentuated the slide in the pound sterling which weighs on the cross’ uptrend line.

A fall through Wednesday’s low at $1.1186 may lead to the minor psychological $1.10 mark being revisited. Below it last week’s low at $1.0924 can be found. If also fallen through, the 27 September high at $1.0838 would be targeted. Resistance remains to be seen along the August-to-October downtrend line at $1.1388 and at this week’s high at $1.1439 as well as at the early October peak at $1.1495.

GBP/USD chartSource: IT-Finance.com
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EUR/USD, GBP/USD and AUD/USD rebound brings potential reversal opportunity

EUR/USD, GBP/USD and AUD/USD rebound into resistance, but wider bearish patterns signal the potential for another downside move.

 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 24 October 2022 

EUR/USD rally takes the price back into key trendline resistance

EUR/USD has managed to claw back enough ground to take the price into a long-term descending trendline. While the price is yet to engage with the trendline, it is worthwhile noting the potential for a similar fate to previous occasions that the pair has approached this line.

Dollar pressure has certainly eased of late, with traders pondering what might happen when the Federal Reserve (Fed) stop raising rates. However, for now it seems highly unlikely that the Fed will look to cut interest rates anytime soon, with that extended period of elevated rates likely to drive further economic weakness and dollar strength.

With that in mind, this rebound does look similar to the previous occasions, with the pair expected to turn lower once again here. A rise through parity ($1.00) would be required to provide an initial signal that we could be on our way to a more bullish phase. Until then, bearish positions are favoured.

EUR/USD chartSource: IT-Finance.com

GBP/USD rallies into trendline resistance

GBP/USD has also managed to regain ground, with the UK political system looking to gain stability after Boris Johnson pulled out of the leadership race. With Sunak looking nailed on as the new prime minister (PM), sterling is likely to be encouraged that we essentially have two chancellors at the helm.

Nonetheless, dollar strength is the wider story that will likely dominate this pair, with the recent rebound in GBP/USD reflecting the rebound in stocks. As such, another risk-off move in markets would bring a bearish reversal for this pair. With trendline resistance in play here, there is a good chance we do see a move lower before long.

A rise up through $1.1495 and $1.1738 would be required to bring about a more positive view for the pair.

GBP/USD chartSource: IT-Finance.com

AUD/USD turning lower from Fibonacci resistance

AUD/USD has found itself on the back foot as we start the week, with the wider bearish trend looking to kick in once again.

Overnight data out of China did little to help the Australian dollar, with imports and exports both disappointing. While the price finally managed to break up through the previous low of $0.6363 last week, this simply took us into the 61.8% Fibonacci resistance level at $0.6403.

As such, another move lower looks likely from here, with a break up through the $0.6547 swing high required to bring about a more positive outlook.

AUD/USD chartSource: IT-Finance.com
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EUR/USD and GBP/USD cling to gains while USD/JPY remains near ¥149.00

For now EUR/USD and GBP/USD are holding up against the dollar, while the yen is being given support by Japan’s intervention in FX markets.

JPY/USDSource: Bloomberg
 
 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 25 October 2022 

EUR/USD nudges the 50-day SMA

The general recovery in risk assets has lifted EUR/USD from its September low, but now the pair has returned to the 50-day simple moving average (SMA), which has been such a barrier over the past few months.

With the downtrend still firmly in place sellers will be on the lookout for a fresh turn lower, perhaps marked by a turn lower in stochastics and then followed up by a bearish MACD crossover. This would then bring the September lows around $0.954 into view.

EUR/USD chartSource: ProRealTime

GBP/USD holds firm

Sterling continues to cling on to the $1.13 level, having fended off a turn lower at the end of last week. For GBP/USD this might provide scope for a push back to the 50-day SMA ($1.1399), while the $1.15 highs from early October loom beyond this.

As with EUR/USD, the overall downtrend is still in place, and so any turn lower would be viewed as a lower high, targeting $1.10 and lower.

GBP/USD chartSource: ProRealTime

USD/JPY holds close to ¥149.00

Japan’s intervention in FX markets continues to prevent further upside here for the time being for USD/JPY, although the price has bounced back from the lows seen on Monday.

The modest retracement from last week’s highs is another indication of the strength of the move higher. A continued drift lower might brin the 50-day SMA into view.

Overall, however, the uptrend is still ongoing, although it has paused for the time being.

USD/JPY chartSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD push through key resistance levels

EUR/USD, GBP/USD and AUD/USD continue their countertrend recovery, with price breaking through key resistance levels.

EuroSource: Bloomberg
 
 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 26 October 2022 

EUR/USD breaks both trendline and parity resistance

EUR/USD has been on the rise of late, with risk-on sentiment seen throughout global markets bringing about a bout of downside for the dollar. That dollar decline has helped lift currency pairs such as EUR/USD, with further volatility ahead in the form of the Eurepean Central Bank (ECB) meeting tomorrow. Crucially, we have seen the price manage to break both trendline and $1.00 resistance this week.

That marks the first closed candle above this trendline since its inception in February. While this could mark the beginning of a wider bullish phase for the pair, there is still a good chance that he turns lower from the $1.0041 Fibonacci resistance level. The break above $1.00 is certainly notable, but it would take a rise through $1.0198 to truly bring an end to the bearish trend of lower highs seen over the course of the year. Until that occurs, another leg lower does still remain likely.

EUR/USD chartSource: ProRealTime

GBP/USD rebound pushes through key resistance

GBP/USD has continued its recovery this week, with the price managing to push up through the $1.1495 resistance in the process. Similarly, we have also seen the descending trendline taken out yesterday. Whether this is the beginning of a wider recovery phase remains to be seen, with the $1.1738 resistance level providing the next hurdle for the bulls.

Given that this represents that first true swing-high, such a break would be a notable event for the bulls. To the downside, a move below the $1.106 level would bring greater confidence that this recovery phase is over.

GBP/USD chartSource: ProRealTime

AUD/USD breaks through Fibonacci resistance

AUD/USD has managed to break through the 76.4% Fibonacci resistance level today, with the pair surging higher once again. The wider trend remains bearish unless we break through the $0.6547 swing-high.

Such a move would signal a potential wider retracement of the $0.7136-$0.617 selloff coming into play. However, until that break occurs, there is still a chance that we see price turn lower once again here.

AUD/USD chartSource: ProRealTime
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Dollar weakness drives up EUR/USD and GBP/USD while weighing on USD/JPY

While both the pound and the euro are little changed so far, the yen continues to make headway against the greenback.

EUR/USDSource: Bloomberg
 
 Chris Beauchamp | Chief Market Analyst, London | Publication date: Thursday 27 October 2022 

EUR/USD holds firm ahead of ECB meeting

Hopes of a hawkish European Central Bank (ECB) meeting have driven EUR/USD to its highest level since early September, returning the price to the 100-day simple moving average (SMA).

The downtrend is still in place, and indeed if the ECB proves to be more cautious than expected, a reversal here could develop rapidly. This would then bring trendline support from the September low into view, and potentially back to those September lows in time.

Alternatively, the price will target $1.02 and then $1.036, the August high, in the event of additional upside.

EUR/USD chartSource: ProRealTime

GBP/USD back at $1.16

GBP/USD's resurrection from its September low continues, although it is arguably much more a function of dollar weakness than it is any renewed confidence in the British economy.

A one-month high for GBP/USD has seen the price push on above the 50-day SMA (currently $1.1387) for the first time since early August. However, it is still in a downtrend, so buyers may be cautious about pushing too hard on this for the time being.

A reversal back below $1.14 would likely be taken as a signal that a fresh leg lower is in progress, with trendline support from the September low likely to be tested in short order.

GBP/USDSource: ProRealTime

USD/JPY weakens for another day

Intervention by the Ministry of Finance has finally resulted in a sustained move lower for the USD/JPY, towards the 50-day SMA.

However, just as the downtrends for EUR/USD and GBP/USD are still in place for now, the uptrend here is now seriously challenged by this move. Indeed, buyers may welcome it as the first real downward move, with the potential for a higher low in due course.

Additional declines target the 50-day SMA (currently ¥143.68), and then below this down to the ¥140.00 level and the 100-day SMA (currently ¥139.54).

USD/JPYSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD start to reverse lower after recent bounce

EUR/USD, GBP/USD and AUD/USD show initial signs of a fresh bearish reversal after a period of upside.

 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Friday 28 October 2022 

EUR/USD starts to roll over after latest pop

EUR/USD has managed to regain a significant amount of ground over the course of October thus far, with the price currently on track to close out the first monthly gain since May. However, despite the rise through parity and the early-October peak, there is a good chance we could see the pair move lower from here.

It is worthwhile noting that the true swing high that needs to break to bring a potential reversal signal is $1.0198. With that resistance level still intact, the bearish trend holds for now. This recent rise has brought a fresh move into overbought on the stochastic, with the current reversal in the price action bringing a likely move back below 80 on the stochastic.

We have only seen that signal three times in 2022 thus far. Each of which soon resulted in another leg lower for the pair. With that in mind, another turn lower looks likely until we see the price rise through $1.0198.

EUR/USD chartSource: ProRealTime

GBP/USD rebound starts to fade

GBP/USD has enjoyed a period of counter-trend upside, with Rishi Sunak’s appointment bringing confidence that we will not see a repeat of Liz Truss’ mistakes.

The price has managed to break up through the trendline $1.1495 resistance, but we remain below the crucial swing high levels of $1.1738 and $1.2277. Greater confidence of a return to the prior lows of $1.0328 comes with a break below $1.106.

However, until we see the likes of $1.1738 broken, there is a good chance that the wider bearish trend kicks in here.

GBP/USD chartSource: ProRealTime

AUD/USD reversing lower after deep retracement

AUD/USD has typically been an underperformer of late, with the Reserve Bank of Australia (RBA) rate hike slowdown bringing further pressure on the Australian dollar.

A break through the $0.6547 swing high would be required to bring a wider retracement into play. However, until that happens there is a good chance we see the bears come back into play from here.

AUD/USD chartSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD expected to start losing traction after recent bounce

EUR/USD, GBP/USD and AUD/USD upside under question, with wider bearish trend expected to come back into play before long.

 Joshua Mahony | Senior Market Analyst, London | Publication date: Monday 31 October 2022 

EUR/USD turning lower from moving average resistance

EUR/USD has started the week on a relatively downbeat tone, with the pair seeking to continue the bearish trajectory playing out since Thursday. The wider bearish trend does bring expectations of a deterioration despite the latest period of upside.

However, that rebound has managed to see the price push through the early-October peak of $1.00, rising through the wider 76.4% Fibonacci level in the process. However, we would need to see a push through $1.0198 to signal a potential end to this downtrend that has dominated the year thus far.

With the price starting to weaken from the 100-day simple moving average (SMA), there is a chance we are going to see the pair turn lower from here. As such, watch for a potential downside, with a break through $1.0198 required to bring a more positive outlook.

EUR/USD chartSource: ProRealTime

GBP/USD approaches key resistance level

GBP/USD has similarly been on the front foot over the course of the past month, with the price rising into the $1.16 level for the first time since mid-September.

The wider bearish trend does signal the potential for a bearish turn before long, although we are yet to see any particular signal that such a downward move has started.

To the upside, it is worthwhile noting the existence of the trendline, 100-SMA, and 76.4% Fibonacci resistance. With that in mind, a potential downward turn could be impending as the downtrend kicks in once again.

GBP/USD chartSource: ProRealTime

AUD/USD reversing lower after recent rebound

AUD/USD has started to reverse lower after a period of gains that took the pair up towards the $0.6547 swing high.

The weakness of the Australian dollar over recent weeks appears to be coming back into play here, with the price already heading lower in early trade today.

As such, another leg lower looks likely here, with a rise through $0.6547 required to bring about expectations of a wider rebound.

AUD/USD chartSource: ProRealTime
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Dollar weakens as FOMC begins its two-day meeting

EUR/USD and GBP/USD are recovering this morning while USD/JPY drops back, as nervousness builds in markets as they look towards tomorrow’s Fed decision.

dollarSource: Bloomberg
 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 01 November 2022 

EUR/USD attempts to hold the 50-day SMA

EUR/USD retreated yesterday, returning to the 50-day simply moving average (SMA) (currently $0.9888) after breaking above it last week.

The price is now rebounding from oversold intraday conditions, moving higher off the 50-day moving average (MA) in a bid to recover lost ground. A drop back below the 50-day MA would bolster the bearish view, and bring trendline support from the September low into play. Further losses below this would likely signal an additional push back to the lows of September.

Continued gains above $0.998 would likely suggest that another attempt to push higher is underway.

EUR/USDSource: ProRealTime

GBP/USD recovers above $1.15

Dollar strength bore down on GBP/USD yesterday, but it has edged up in early trading.

This pair still finds itself awaiting the Federal Reserve (Fed) decision tomorrow, but hopes of a softer Fed outlook have seen a small recovery. Further declines towards the 50-day SMA (currently $1.137) would also bring rising trendline support from the September low into view.

A move back above last week’s highs would continue to bolster the neutral view and suggest that the pair may push towards the 100-day SMA.

GBP/USDSource: ProRealTime

USD/JPY drops back

The USD/JPY apparent recovery has stalled, as nervousness around the next Fed decision prompts some dollar weakness.

Further declines target the 50-day SMA (currently ¥144.32), deepening the retracement but leaving the uptrend firmly intact.

Bulls will want to see today’s weakness reversed and a fresh move towards ¥150.00 develop.

USD/JPYSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD start to find their feet once again

EUR/USD, GBP/USD and AUD/USD start to rise once again, but near-term gains look likely to fade before long.

 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 02 November 2022 

EUR/USD starts to find its feet after recent losses

EUR/USD has been losing traction of late, with the gains seen over the course of October starting to fade in recent trading days. However, this decline into trendline support brings questions of whether the recent recovery phase is set to continue. Ultimately, we will need to see a break back below the $0.8631 swing-low to bring confidence of another leg lower for the pair.

Until then, this trendline provides a potential area for the price to reverse upwards from or continue its rebound. It is worthwhile noting that despite the recent break through the descending trendline, the pair remains within a downtrend until we see a move through $1.0198. Until that level is broken, bearish positions are favoured.

EUR/USD chartSource: ProRealTime

GBP/USD rebound may not be over quite yet

GBP/USD has also been regaining ground over the course of the past month, with the pair pushing up into a six-week high last Thursday. We have been moving lower since, raising questions over whether we are due a bearish reversal for the pair.

A decline through $1.106 support would bring increased confidence that the price is set for another bearish turn here. However, until that happens, another rebound towards trendline and the 100-SMA (simple moving average) resistance level looks a distinct possibility.

GBP/USD chartSource: ProRealTime

AUD/USD starts to rebound from support

AUD/USD is on the rise today, with the pair seeking to get back on the front-foot after a decline from just below the $0.6547 resistance level. The wider trend does point towards a bearish resolution before long.

However, it seems we are seeing the $0.6363 support level come back into play today. A rise through $0.6547 would point towards a potential wider recovery for the pair. Until then, another bearish turn looks likely before long.

AUD/USD chartSource: ProRealTime
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EUR/USD, GBP/USD, and AUD/USD reverse lower as FOMC meeting sparks dollar resurgence

EUR/USD, GBP/USD and AUD/USD head lower as dollar dominance comes back on the cards.

EUR/USDSource: Bloomberg
 
 Joshua Mahony | Senior Market Analyst, London | Publication date: Thursday 03 November 2022 

EUR/USD tumbles as dollar domination comes back on the cards

EUR/USD has been on the slide following a Federal Open Market Committee (FOMC) meeting that saw Jerome Powell warn that the tightening phase will be more protracted and reach a higher terminal rate. Despite calls of a potential pivot in policy, that is some way off yet. As such, the wider bearish trend for EUR/USD is back in play here, with the pair expected to head lower once again. The current decline takes price into trendline support, although that is likely to break.

However, between the trendline, and $0.9631, we have two notable support levels in view. Ultimately, a bearish view holds unless we see price break through the $1.0198 swing-high.

EUR/USDSource: ProRealTime

GBP/USD reversing lower ahead of Bank of England meeting

GBP/USD has similarly been on the back foot, with recent gains looking to have set us up for another bearish turn for the pair. With the Bank of England (BoE) expected to raise rates by 75-basis points (bp) today, there is likely to be plenty of volatility as traders weigh up the GBP benefit of higher rates vs the economic risks it creates.

Nonetheless, with markets on the turn as risk-off sentiment dominates, it does look likely that we have seen a top for this market. A push through the $1.1738 resistance level would be required to negate this view.

GBP/USDSource: ProRealTime

AUD/USD rolls over after recent retracement

AUD/USD looks to be rolling over once again, with the pair faltering after the FOMC meeting. The bearish trend seen over the course of the year thus far looks to be back on the cards, with a move up through the $0.6547 level needed to bring a wider upward retracement into play.

However, we instead look to be heading swiftly lower, with the $0.617 low coming as the next major level of note.

AUD/USDSource: ProRealTime
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EUR/USD and USD/JPY consolidate while EUR/GBP advances

Outlook on EUR/USD, EUR/GBP and USD/JPY as China vows to stick to Covid Zero policy.

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Monday 07 November 2022 

EUR/USD nears parity

Friday’s EUR/USD surge higher is taking a breather below parity despite September German Industrial Production coming in at a better than expected 0.6% month-on-month (MoM) rise versus -0.8% in August.

EUR/USD short term consolidates below last week’s $0.9976 high and may slip back towards the 55-day simple moving average (SMA) at $0.9887 before having another go at reaching parity above which lurks the late-October peak at $1.0093.

Minor support below the 55-day SMA can be spotted at the $0.9865 early-September low as well as Thursday’s $0.9839 high.

EUR/USD chartSource: IT-Finance.com

EUR/GBP continues its advance towards its £0.8867 October peak

EUR/GBP is on track to reach its £0.878 21 October high as the Euro continues to appreciate and as the UK October Halifax House Price Index comes in as expected at -0.4% MoM versus -0.1% in September, its second consecutive monthly slide.

Above £0.878, the 26 and 28 September lows can be found at £0.8853 as well as the October peak at £0.8867.

Minor support below Thursday’s £0.8743 high comes in along the 55-day SMA at £0.8695. Below it lies the early-October low at £0.8649.

EUR/GBP chartSource: IT-Finance.com

USD/JPY rises as China vows to stick to its strict Covid Zero policy

USD/JPY regains some of Friday’s losses amid comments by Chinese officials over the weekend denying that the country was considering easing its strict zero-Covid 19 measures.

A recovery from Friday’s ¥146.56 low, made marginally above its August-to-November uptrend line at ¥146.56, is currently underway with the October-to-November resistance line at ¥148.02 being in focus. Above it lie last week’s highs at ¥148.45 to ¥148.85.

A currently unexpected slip through the three-month uptrend line at ¥146.56 would engage the early-November low at ¥145.68 below which sits the late October through at ¥145.12.

USD/JPY chartSource: IT-Finance.com
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Dollar weakness pushes down USD/JPY and allows EUR/USD and GBP/USD to hold on to gains

The dollar remains unsteady ahead of the US mid-terms, causing further losses for USD/JPY while giving EUR/USD and GBP/USD strength to hold most of their recent gains.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 08 November 2022 

EUR/USD surge stalls

EUR/USD rebound over the past two days has carried the pair back to the 100-day simple moving average (SMA). This bounce has seen it recover trendline support from the late September low and break above the short-term trendline resistance that held in late October and early November.

Now the price must clear the 100-day SMA, and ideally hold above it, to target further gains, with the $1.02 level in sight. Sellers would be looking for a reversal back below the 50-day SMA as a sign that the downtrend has reasserted itself.

EUR/USD chartSource: ProRealTime

GBP/USD pushes back towards recent peak

GBP/USD has managed to bounce back above the 50-day SMA, and now a move back to $1.16 seems likely. Dollar weakness has allowed for a revival here, but it is far from clear whether the bounce has the strength to continue given the broader caution about the UK economy.

Further gains above $1.16 bring the 100-day SMA into view, and then on towards $1.176. As the downtrend is still extant for now, a reversal below the 50-day SMA would be a fresh bearish development, potentially opening the way to $1.05 or lower.

GBP/USD chartSource: ProRealTime

USD/JPY weakens towards 50-day SMA

USD/JPY short-term reversal continues here, pushing it towards the 50-day SMA again. This marks the most sustained decline in the pair since August, but leaves the uptrend intact for the time being.

A rebound from the 50-day SMA could be the signal that a new leg higher is underway, targeting ¥150.00 and higher. Further losses towards ¥141.00 would put further pressure on the uptrend, but not bring it to a complete halt.

USD/JPY chartSource: ProRealTime
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EUR/USD, GBP/USD and AUD/USD rebound into key resistance

EUR/USD, GBP/USD, and AUD/USD rise back into key resistance levels as risk attitudes improve.

EUR/USDSource: Bloomberg
 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 09 November 2022 

EUR/USD rises into key resistance level

EUR/USD has pushed higher once again, with the rise in equity markets also being reflected by dollar weakness as the midterm election results roll in.

While the Senate is still up for grabs, the House looks highly likely to fall into Republican hands. Such an event brings less chance the Biden’s inflationary spending plans come to fruition, thus helping risk assets. While we have been seeing the pair on the rise of late, there is still a risk of a bearish turn given the long-term trend of lower highs.

That downtrend would require a break above the $1.0198 level to come to an end, with a distinct possibility of another move lower until such a break comes to fruition. With that in mind, keep an eye out for whether the price breaks or reverses from this $1.0093 resistance level.

EUR/USD chartSource: ProRealTime

GBP/USD rises back into trendline resistance

GBP/USD has also been regaining ground over the course of this week thus far, with the outperformance from Friday’s US jobs data providing the beginning of another move higher.

That rebound has now taken us into trendline resistance, which is accompanied by last week’s high ($1.1645), and the 100-day simple moving average (SMA). A break up through the $1.1738 level would bring expectations of a more protracted rebound for this pair.

However, until such a move comes to fruition, there is a good chance that we see the bears come back into play once again. A decline through $1.1146 would bring a bearish confirmation signal.

GBP/USD chartSource: ProRealTime

AUD/USD rebounds into short-term resistance

AUD/USD has managed to regain lost ground this week, with the price rising into a six-week high yesterday. It is worthwhile noting the overnight inflation data out of China, with the collapse in producer price index (PPI) and a five-month low for consumer price index (CPI) easing pricing concerns elsewhere.

While we have seen the Australian dollar underperform thanks to the Reserve Bank of Australia (RBA) decision to slow the rate hike rise earlier than their peers, this rebound could have legs if we see the price push through $0.6547.

A solid break through that level would bring about expectations of a wider retracement of the $0.7137 to $0.617 selloff. As such, the reaction to this $0.6547 will be key in determining sentiment over the near term.

AUD/USD chartSource: ProRealTime
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EUR/USD and USD/JPY await US inflation data while EUR/GBP continues to rise

Outlook on EUR/USD, USD/JPY and EUR/GBP ahead of US inflation data release.

EUR/USDSource: Bloomberg
 

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Thursday 10 November 2022 

EUR/USD consolidates ahead of US inflation data

EUR/USD’s swift advance paused around its $1.0093 late October high with it now consolidating slightly above parity ahead of Thursday’s US October Consumer Price Inflation (CPI) data which is expected to slip to 8.1% year-on-year (YoY), from 8.2% in September.

The pair thus consolidates below its recent $1.0093 to $1.0096 highs and may slip back towards its early October high at $0.9999. Further support can be spotted around the mid-September low at $0.9946. Were the current consolidation phase to be followed by renewed upside and a rise above $1.0096, the mid-September peak at $1.0198 would be in focus.

EUR/USD chartSource: IT-Finance.com

EUR/GBP remains on track to reach its £0.8867 October peak

EUR/GBP continues its advance towards its £0.8867 mid-October high as the Pound Sterling depreciates further and as the UK RICS House Price Balance comes in at -2% versus an expected 19% and a revised 30% (from 32%) in the previous month.

Above Wednesday’s £0.8828 high, the 26 and 28 September lows can be found at £0.8853 as well as the October peak at £0.8867. Minor support below the 21 October high at £0.8780 high can be seen along the November support line at £0.8741 as well as along the 55-day simple moving average (SMA) at £0.8713. Further down lies the early October low at £0.8649.

USD/GBP chartSource: IT-Finance.com

USD/JPY stabilises ahead of US CPI data release

USD/JPY stabilised around its ¥145.11 late October low over the past couple of days while awaiting US October inflation data, with any slowing of price rises likely weighing on the greenback and push it towards the 55-day simple moving average (SMA) at ¥144.92 and perhaps also to the ¥143.53 early October-low.

Stronger than expected inflation would probably prompt a revival of concerns about a continued sharp pace of the Federal Reserve (Fed) tightening and thus propel the US dollar towards its two-month downtrend line at ¥146.95 and perhaps also the late October peak at ¥148.85.

USD/JPY chartSource: IT-Finance.com
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EUR/USD, GBP/USD and AUD/USD rebound on lower US inflation

EUR/USD, GBP/USD and AUD/USD spike higher, as US inflation data lifts hopes of a pivot from the Fed.

EuroSource: Bloomberg
 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Friday 11 November 2022 

EUR/USD breaks resistance as US CPI lifts pivot hopes

EUR/USD saw a sharp push higher yesterday, as the latest US inflation survey brought hope that we may have turned a corner. While this could mark the beginning of a trend that may ultimately lead to a pivot from the US Federal Reserve (Fed), it is worthwhile noting that inflation remains highly elevated and is still a major problem that is far from resolved.

Nonetheless, with Fed members mentioning the potential to slow the pace of tightening in response, we are now looking at a 50-basis point (bps) rise in December. While the long-term picture brings expectations of economic decline and the potential for a second wave of inflation, the near-term sentiment has certainly taken a positive turn. The break through $1.1098 has ended the 2022 trend of lower highs, signalling a strong chance that we see the bulls back in charge once again for the time being. As such, further upside seems likely for now, with a break back below $0.9935 required to negate that view.

EUR/USD chartSource: ProRealTime

GBP/USD pushes through trendline and horizontal resistance

GBP/USD has been heading sharply higher as the dollar loses traction. Much like the eurozone, UK inflation continues to stand well above that of the US. Hence the pivot outlook actually looks more likely to come from the Fed before the European Central Bank (ECB) and Bank of England (BoE).

This should help cable continue its ascent, with the push through $1.1738 bringing a bullish signal. As such, more upside does look likely despite disappointing UK gross domestic product (GDP) data this morning. Keep an eye out for $1.1829 Fibonacci resistance up ahead as a potential hurdle. However, the key resistance level comes in the form of the $1.2293 swing-high. For now, further upside looks likely unless we see the price decline below $1.1146.

GBP/USD chartSource: ProRealTime

AUD/USD spikes through resistance to bring wider retracement

AUD/USD has similarly seen the price turn sharply higher as the dollar comes under pressure.

The break up through $0.6547 resistance brings the wider retracement into view, although the near-term hurdle comes in the form of the prior low of $0.6681 and 100-day simple moving average (SMA). In any case, the push through $0.6547 does signal a likely upward move from here, with the bearish pressure built over the course of recent months finally released for what could be a more positive phase for the pair.

AUD/USD chartSource: ProRealTime
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EUR/USD and USD/JPY to consolidate last week’s strong gains while EUR/GBP range trades

Outlook on EUR/USD, USD/JPY and EUR/GBP post weaker-than-expected US inflation print.

 

 

 Axel Rudolph FSTA | Senior Financial Analyst, London | Publication date: Monday 14 November 2022 

EUR/USD consolidates post softer US inflation data rally

Last week’s swift EUR/USD advance due to softer than expected US consumer price index (CPI) data took it to $1.0364, close to the $1.0368 August peak, before consolidating around the $1.03 mark as Federal Reserve Governor Christopher Waller warned investors against getting too optimistic over one inflation report.

He also said that the US Federal Reserve (Fed) 'still got ways to go' with interest rate hikes whilst acknowledging that the Fed may slow the pace of rate increases in the coming meetings. Since the cross has risen by over 6% since early November it wouldn’t be surprising if a few days of consolidation were to be witnessed this week.

Support comes in at the $1.0198 September peak whereas resistance above the $1.0368 August high can be spotted along the 200-day simple moving average (SMA) at $1.0435.

EUR/USD chartSource: IT-Finance.com

EUR/GBP trades sideways between £0.8828 and £0.8691

EUR/GBP’s advance towards its £0.8867 mid-October high amid weaker than expected UK housing data last week has paused and taken the cross back towards the 55-day SMA at £0.872 around which it is consolidating.

The eventual break out of the current £0.8828 to £0.8691 trading range is likely to determine the ensuing trend with a rise above Wednesday’s £0.8828 high pushing the 26 and 28 September lows at £0.8853 as well as the October peak at £0.8867 to the fore.

Support below the November support line at £0.873 and the 55-day SMA at £0.872 can be spotted at the 7 and 10 November lows at £0.8701 to £0.8691. Further down lies the early October low at £0.8649.

EUR/GBP chartSource: IT-Finance.com

USD/JPY drops to 2,5 month lows

Last week’s USD/JPY slip through its ¥145.11 late October low led to a swift 4.5% drop in the exchange rate to ¥138.46, a 2,5 month low, amid a weaker than expected US October CPI print of 7.7% versus an expected 8.1%.

Short term, some consolidation around the ¥140.00 mark is likely to be seen with first resistance being encountered around the post currency intervention ¥145.35 late September low. Further minor resistance can be found at the ¥141.51 9 September low.

Were last week’s low at ¥138.46 to give way, however, the 23 August high at ¥137.71 would be eyed, a fall through which could lead to the early August high at ¥135.58 being back in the frame. Further down meanders the 200-day SMA at ¥132.88.

USD/JPY chartSource: IT-Finance.com

 

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EUR/USD and GBP/USD move up while USD/JPY remains stuck below 100-day SMA

The euro and sterling have moved up against the dollar, with the pound boosted by wage data this morning. USD/JPY is holding steady just below the 100-day SMA.

 

 Chris Beauchamp | Chief Market Analyst, London | Publication date: Tuesday 15 November 2022 

EUR/USD returns to the 200-day SMA

The scale of the decline in EUR/USD is apparent following today’s price action, which has carried the pair back to the 200-day simple moving average (SMA) for the first time since June 2021.

From the September low, the price has rebounded almost 10%, moving back above parity and successfully moving above the $1.036 area that marked support in May and then a lower high in August.

Further gains from here target the $1.0615 area, last seen in June, while a reversal below $1.03 might suggest that a period of consolidation is likely, following the surge of September – November.

EUR/USD chartSource:ProRealTime

GBP/USD holds above $1.18

For GBP/USD the pound has pushed back above $1.18, reversing Monday’s weakness, as data shows further strength in UK wages.

After a mixed session yesterday, which nonetheless saw the pair hold on to most of its gains from the end of last week, the price has moved back above $1.18. Additional gains now target $1.208, and the 200-day SMA at $1.225.

Some consolidation around current levels, or a drop back towards $1.14, might not be surprising given the amount of data on the UK this week, along with the fiscal statement. A move back below $1.14 and/or the 50-day SMA would likely signal that the downtrend has been revived.

GBP/USD chartSource:ProRealTime

USD/JPY hovers below the 100-day SMA

After a small recovery yesterday for USD/JPY, the price has edged lower, remaining below the 100-day SMA.

Unlike EUR/USD and GBP/USD, where the downtrends have seen an impressive bounce, the uptrend here is still intact. The latest pullback has seen the price drop from ¥150.00 to ¥140.00, with additional targets at ¥135.00 in the event of further downside.

A recovery above the 100-day MA might signal that a higher low has been created, and might point towards additional gains towards ¥150.00.

USD/JPY chartSource:ProRealTime
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EUR/USD, GBP/USD and AUD/USD continue to grind higher

EUR/USD, GBP/USD and AUD/USD grind higher, with traders reacting to the latest UK inflation figure.

AUDSource: Bloomberg
 
 Joshua Mahony | Senior Market Analyst, London | Publication date: Wednesday 16 November 2022 

EUR/USD pushing higher in bullish continuation move

EUR/USD looks set to continue its recent resurgence, with the pair seeking to follow up on the four-month high established yesterday.

The recent consolidation has seen the pair attempt to resolve the question of whether we will post a downside retracement of note or simply push higher once again. The failure to break below the $1.0271 signified the latter, with prices pushing upwards once again today.

As such, further gains seem likely, with a move back below the $1.0271 required to signal a potential short-term reversal of the recent spike.

EUR/USD chartSource: ProRealTime

GBP/USD comes into focus after surge in UK CPI

GBP/USD has similarly been gaining ground in the wake of the risk-on move sparked by Thursday’s US consumer price index (CPI) decline. However, today has seen inflation come back into play today, with the latest UK CPI figure of 11.15% signaling a huge divergence coming into play between the UK and US inflation figures.

Quite whether this will create any divergence in monetary policy remains to be seen, with market pricing in a higher chance of a 75-basis point (bs) rate hike in response. As things stand the market reaction has been muted, with market weighing up any shifts in monetary policy with the expectations of a more prolonged economic downturn in the UK if inflation is not brought under control.

As things stand, GBP/USD looks set for further upside, with a decline through the $1.171 swing low required to bring expectations of a pullback for the pair.

GBP/USD chartSource: ProRealTime

AUD/USD continues to grind higher

AUD/USD has continued its move higher, with the risk-on sentiment seen throughout markets bringing about a positive phase for this pair.

While last week saw the index spike upwards, we are seeing a more considered approach this week. Nonetheless, this grind higher does look likely to persist unless price falls back through the $0.6663 swing low.

Look out for further volatility ahead, with the latest Australian jobs report due out tomorrow morning.

AUD/USD chartSource: ProRealTime
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