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EUR/USD, GBP/USD and USD/JPY all steady after recent gains


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The pound is holding firm in the wake of another strong CPI reading, while EUR/USD and USD/JPY are looking for additional upside.

 

EUR/USD holds around $1.10

A recovery continues here with EUR/USD in the short term, with a bounce from yesterday’s lows helping to maintain the bullish view. However, the price has yet to attempt a move above $1.11 resistance so far this month.

Even a bounce towards $1.12 leaves the downtrend intact. In the near term a fall back below yesterday’s lows at $1.096 would mark a bearish development and potentially bring the $1.08 level back into view.

EUR/USD chartSource: ProRealTime

GBP/USD steady after CPI figures

A solid bounce here with GBP/USD yesterday has put new life into the countertrend rebound that has been in progress since the middle of the month. However, this rebound from a lower low is still within a much broader downtrend, and as with EUR/USD, the possibility of a lower high is still strong.

For now, the buyers have the upper hand, and a move back towards $1.34 seems likely. A reversal below $1.32 would suggest a new leg lower is underway.

GBP/USD chartSource: ProRealTime

USD/JPY holds near highs

The remarkable bounce in USD/JPY shows no sign of slowing, and indeed it has accelerated in pace, surging through the ¥120.00 level. By any measure this is overextended, but for now bullish momentum continues to carry it higher. The 2007 and 2015 highs at ¥124.00 are now the next big levels to watch on the upside.

Buyers should beware of the potential for a pullback however, with a move back towards the 50-day simple moving average (SMA) creating a higher low and leaving the uptrend intact, even if much of the ground gained over the past three weeks is given back.

USD/JPY chartSource: ProRealTime
 
Chris Beauchamp | Chief Market Analyst, London
23 March 2022
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