EUR/USD, GBP/USD resume their descents while USD/CNH advances amid greenback strength
Outlook on EUR/USD, GBP/USD and USD/CNH amid strong post US employment data greenback strength.
EUR/USD slips to seven-week low
EUR/USD resumed its downtrend amid Friday's nearly twice as expected strong non-farm payrolls reading which saw the chances of a March rate cut by the Federal Reserve (Fed) diminish yet further and led to a rally in the US dollar.
The cross is thus seen falling towards its early November high and December low at $1.0756 to $1.0724 which may offer support ahead of its late October $1.0695 high.
Resistance above last Monday’s $1.0796 low is seen along the 200-day simple moving average (SMA) at $1.0839.
GBP/USD probes lower end of its sideways trading band
GBP/USD continues to range trade but is now testing the lower end of its two-month band and probes the $1.2612 to $1.2597 support zone which consists of the late December-to-January lows.
If slipped through, the 200-day SMA at $1.2565 may be reached as well, ahead of the $1.2501 early December low.
Minor resistance can be found at Tuesday’s $1.264 low and also at the 23 January low at $1.2649.
USD/CNH rallies amid strong US dollar
Friday’s much better-than-expected US employment data, with the US economy having added jobs for 37 months in a row, and slowing China services growth as well as the country’s 10 year bond yield trading below its Covid-19 epidemic low have led to further USD/CNH strength.
With both the 200-day SMA at CN¥7.2016 and the December high at CN¥7.20 having been exceeded, the mid-January peak at CN¥7.2322 is back in sight.
Minor support is seen along the 200-day SMA at CN¥7.2016 as well as at last Monday’s CN¥7.1969 high.
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