EUR/USD and EUR/JPY mixed while EUR/GBP rallies on hawkish central bankers
Outlook on EUR/USD, EUR/GBP and EUR/JPY following Wednesday’s European Central Bank (ECB) meeting in Sintra, Portugal.
EUR/USD stays range bound
At the end of last week EUR/USD fell back from its six-week high at $1.1012 amid weak Eurozone flash purchasing managers index (PMI) with it dropping to $1.0845 before range trading between these two extremes this week.
Hawkish comments by central bankers at the ECB meeting in Sintra, Portugal, on Wednesday initially led to some Euro weakness versus the greenback but didn’t take the cross out of its sideways trading range. The 55-day simple moving average (SMA) at $1.0883 acted as support with EUR/USD heading back up towards this week’s high at $1.0976. Above this level lurks the current June peak at $1.1012.
Only a slip through Thursday morning’s intraday low at $1.0881 would put the $1.0845 low from last week back on the map.
EUR/GBP trades in one-month highs
EUR/GBP benefitted from ECB President Christine Lagarde cementing expectations for a ninth consecutive rise in euro zone rates in July with the cross trading in one-month highs up to £0.8658.
Above this level the 55-day SMA represents the next upside target. Since its sits within the mid- to late-May sideways trading range, the area around it is likely to stall the recent advance, this week at least.
Slips should find support around the mid-June high at £0.8613.
EUR/JPY ascent is losing upside momentum
EUR/JPY’s rise is ongoing but at a slower pace as traders increasingly worry about potential intervention by the Bank of Japan (BoJ) pushing the cross back down again.
This follows the Japanese Ministry of Finance recently mentioning yen weakness, saying that they were watching currency moves with a 'sense of urgency'. A rise above this week’s ¥158.00 high would push the February 2007 peak at ¥159.65 and also the minor psychological ¥160.00 mark to the fore.
Support below last week’s high at ¥156.93 is to be found at the 19 June high at ¥155.26.
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