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Risk appetite recovers, lifting EUR/USD, GBP/USD and USD/JPY

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A calmer atmosphere has seen risk appetite boost the euro and sterling against the dollar, lifting USD/JPY.


EUR/USD holds at trendline support

After falling back last week the price has begun to recover with EUR/USD, finding support at the rising trendline from the lows of late January. The run of lower highs since the beginning of the month means that a rally above $1.135 would mark a change and a potential break to the upside. This would bring the February high at $1.149 into view.

A reversal back below $1.13 would see a break of trendline support and revive the bearish view.

EUR/USD chartSource: ProRealTime

GBP/USD looks to push higher

Tuesday’s bounce with GBP/USD has put the buyers back in charge, although they must now push the price on above $1.363, which has marked the limit of gains since the beginning of the month. If this cannot be broken then further sideways movement may result.

A move back below $1.355 would potentially mark the beginning of a deeper turn lower.

GBP/USD chartSource: ProRealTime

USD/JPY recovers 50-day MA

The bounce yesterday with USD/JPY put the price back above the 50-day simple moving average (SMA) at ¥114.86. A higher low may form, and provide a further bullish impulse that may bring ¥116.00 into view.

Today has seen the price open above trendline resistance from the February peak, bolstering a more bullish view. It would require a reversal back below ¥114.50, reversing Tuesday’s gains.

USD/JPY chartSource: ProRealTime

Chris Beauchamp | Chief Market Analyst, London
23 February 2022
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