EUR/USD, GBP/USD and USD/CAD drop on heightened Middle east tensions
Outlook on EUR/USD, GBP/USD and USD/CAD amid fear of escalation in the Middle East.
EUR/USD dips on heightened Middle East tension
EUR/USD is taking a hit and has slid back from Friday’s $1.060 high as safe-haven flows into the US dollar following the outbreak of war in the Middle East pushes the cross lower.
While Friday’s low and the major $1.0484 to $1.0444 support zone underpin, EUR/USD may still try to bottom out from a medium-term perspective. This key support zone consists of the mid-November high, early and December low and January low.
Marginally above Friday’s high at $1.060 sit the previous week’s $1.0617 high, the May low and mid-September low at $1.0632 to $1.0636 which so far remain in sight. A rise and daily chart close above these levels would confirm at least a minor bottoming formation.
GBP/USD takes a knock on heightened Middle East tensions
GBP/USD recovery from last week’s seven-month low at $1.2038 has taken the cross to $1.2261 on Friday, close to its late September high at $1.2271. These levels will need to be exceeded for a medium-term bullish reversal to occur.
Following heightened Middle East tensions GBP/USD slid back to its 29 September low at $1.2181 on US dollar flight-to-safety flows. Below this level lie the 27 September low at $1.2111 and Friday’s low at $1.2106 which could offer support.
If not, last week’s low at $1.2038 would be back in the frame. This low was made near the mid-March low at $1.2011 and the minor psychological $1.20 mark.
USD/CAD drops on spike in oil price
USD/CAD which last week rallied to a near seven-month high at C$1.3785 dropped to C$1.366 on Monday morning as the oil price rose by around 3.5% on heightened Middle East tensions.
This intraday low was made right within the C$1.3668 to $1.3654 April and May highs which offer support. Further down minor support can be seen around the C$1.3641 August high and below it only at the C$1.3568 mid-May high.
Resistance now comes in at the C$1.3694 October peak.
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