EUR/USD, GBP/USD and AUD/USD stabilize after recent declines
EUR/USD, GBP/USD and AUD/USD attempt to arrest their decline after a recent dollar resurgence.
EUR/USD drops into Fibonacci support
EUR/USD has suffered at the hands of a resurgent dollar, with the price reversing after a period of gains that pushed through trendline resistance. However, without a move through the $1.0198 swing high, the wider bearish trend that has dominated this year remains in play.
With the price having slipped into the 76.4% Fibonacci support level, it is worthwhile noting the potential for short-term gains. However, that wider bearish trend does highlight a strong chance that any such rebound would be short term in nature as the dollar comes back into dominance.
GBP/USD falls back from trendline resistance
GBP/USD has been on the back foot yesterday, with a historic 75-basis point (bp) hike from the Bank of England (BoE) doing little to strengthen the pound. In fact, the potential benefits of that hike were essentially wiped out thanks to warnings over the longest recession on record. That economic risk does benefit the dollar, with the pair expected to fall further as the recession gathers steam.
As such, while we could see some short-term upside to continue the pattern of higher lows, this is likely to soon falter to bring another leg lower for this pair. A break through the $1.1738 level would be required to bring a more neutral view.
AUD/USD pushes higher after latest decline
AUD/USD is attempting to regain lost ground after a week of declines that took the pair back down below the $0.63 level. The wider bearish trend does signal a high chance of downside before long, with today’s jobs report likely to provide significant volatility that could help in this process.
However, any short-term upside looks likely to represent a short-term retracement before the bears come back into play. That view holds, unless the price rises through $0.6547 to bring a wider retracement into play.
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