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​​​EUR/USD, GBP/USD resume medium-term descents while USD/JPY rally stalls​

​​​EUR/USD, GBP/USD depreciate as investors believe the BoE and ECB may cut their rates before the Fed. USD/JPY rally stalls.​​

JPY Source: Bloomberg

EUR/USD's post-Fed rally has been short lived with the cross trading back below its 200-day simple moving average (SMA) at $1.0838, painting a more negative picture and changing our medium-term outlook to a bearish one.

The late February-low at $1.0797 represents the next downside target while the 55-day SMA at $1.0853 and the 22 February-high at $1.0888 resistance.

EUR/USD chart Source: TradingView.com
EUR/USD chart Source: TradingView.com

GBP/USD's bearish reversal from Thursday's $1.2803 post-Fed meeting high and fall through the September 2022-to-March uptrend line at $1.2687 changes our forecast to a bearish one.

The 200-day SMA at $1.2591 together with the December-to-February lows at $1.2519 to $1.25 are back in play. Immediate resistance is seen along the breached uptrend line and 55-day SMA at at $1.2687.

GBP/USD chart Source: TradingView.com
GBP/USD chart Source: TradingView.com

USD/JPY's rapid advance has briefly taken the cross above its ¥151.73 October peak to ¥151.86 before giving back some of its recent gains ahead of the weekend.

While Thursday's ¥150.27 low underpins, immediate upside pressure will be maintained, though. While this is the case, the ¥151.91-94 late October and November peaks will remain in sight. Minor support above ¥150.27 sits in the ¥150.88-83 region.

USD/JPY chart Source: TradingView.com
USD/JPY chart Source: TradingView.com

This information has been prepared by IG, a trading name of IG Australia Pty Ltd. 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.

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