Dollar strength continues to drive EUR/USD, GBP/USD, and USD/JPY
The US dollar continues to dominate for EUR/USD, GBP/USD and USD/JPY, with Powell showing little appetite to reversing the recent rise in yields.
EUR/USD tumbles as dollar continues its ascent
EUR/USD dropped back through $1.1992 and $1.1952 support overnight, with Federal Reserve chair, Jerome Powell doing little to appease fears over rising yields. With markets in a risk-off mood, we are seeing plenty of support for the dollar.
With that in mind, the decline we have seen clearly provides an exit from this consolidation phase, driving the pair lower. Further weakness looks likely given this break, with a rise up through $1.2113 required to bring about a more positive outlook.
GBP/USD falls back into key support
GBP/USD has also been under pressure, although as of yet we have not seen a full break from this uptrend. Dollar strength does provide a potential reason to see the pair break through $1.383, yet the question of whether that level is taken out will be crucial today.
A move below the confluence of $1.383 and 200-simple moving average (SMA) support would pave the way for a wider pullback for the pair. As such, sentiment for the pair will be dictated by the ability or inability to break through $1.383.
USD/JPY continues to push higher amid dollar surge
USD/JPY has continued its push higher, with the pair hitting a nine-month high today. That impressive bullish trend has shown few signs of slowing down, with the stochastic remaining elevated over the course of the week.
A break back through the prior swing low of ¥106.67 would bring a more bearish picture into play. Until then, further upside looks likely.
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