EUR/USD, GBP/USD recover on back of weaker US dollar while EUR/GBP hovers above 5-month low
Outlook on EUR/USD, GBP/USD and EUR/GBP post Fed and BoE meetings at which rates were left unchanged.
EUR/USD recovers from six-week low
EUR/USD drop to Thursday’s $1.078 low was followed by a swift advance to above the December-to-February downtrend line at $1.0868 as the US dollar depreciates.
The 55-day simple moving average (SMA) at $1.0915 as well as the 24 January high at $1.0932 are now in sight.
Support below the breached downtrend line can be seen along the 200-day SMA at $1.0841.
GBP/USD rallies as BoE leaves rates unchanged
GBP/USD continues to range trade but is seen heading back up towards last week’s high at $1.2775 as the greenback is retreating.
Strong resistance sits between the December-to-January highs at $1.2786 to $1.2828 which is likely to once again cap.
Slips should find support around the 30 January high at $1.2721 ahead of the 55-day SMA at $1.2673.
EUR/GBP continues to hover above five-month low
EUR/GBP's slide from its £0.8714 December high has taken it to Monday’s £0.8514 five-month low which sits within the June-to-August support area at £0.8519 to £0.8493. This support zone has held since the beginning of the week and continues to do so as the Bank of England (BoE) left rates unchanged.
A fall through £0.8514 to £0.8493 would likely engage the April 2021 low at £0.8472.
Resistance above Thursday's £0.8558 high can be seen at Tuesday’s £0.8567 peak.
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