EUR/USD and GBP/USD consolidate after surge, while USD/JPY struggles to push higher
The euro and sterling have edged back from their recent highs against the dollar, while the greenback lost ground against the yen overnight.
EUR/USD off last week’s highs
Last week saw the EUR/USD price climb to a near four-month high, as hopes of a Federal Reserve (Fed) interest rate cut in September weakened the US dollar.
The price has dropped back below the May highs, but was arguably overextended at these levels, and some consolidation was not surprising. Bulls will want to see a close back above $1.09 to put another challenge of recent highs on the agenda.
In the short-term, further declines could see the price head towards the rising 50- and 200-day simple moving averages (SMA), currently almost level around $1.0814.
GBP/USD stabilises
Like the EUR/USD pair, the GBP/USD pair had enjoyed a strong rally from late June, but that has eased in recent days.
The March high at $1.2893 may provide some support, while below that comes the early June high at $1.286. A close below this would signal a deeper retracement towards the 50-day SMA, currently $1.2759. A close back above $1.295 might help suggest another short-term leg higher has begun.
USD/JPY retreats after late recovery last week
It has been just over a week since Japan intervened in FX markets, and the USD/JPY pair remains under pressure, though it has not yet breached last week’s lows around ¥155.30.
Last week witnessed a rebound off Thursday’s low, but this has fizzled out so far this morning. A close back above the 50-day SMA and above ¥158.00 hands the advantage to the buyers, while alternately sellers will be hoping for a drop back below last week’s low and also below the 100-day SMA.
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