EUR/USD and GBP/USD keep rallying, while USD/JPY comes under fresh pressure
Dollar weakness is driving EUR/USD and GBP/USD higher, while USD/JPY has fallen as the yen strengthens on more strong Japanese data.
EUR/USD surges to two-month high
The EUR/USD rallied to its highest level since mid-January on Friday, continuing its recovery from February’s low.
Since then the price has broken through trendline resistance, and moved back above the 100-, 200- and now the 50-day simple moving average (SMA). The rally has carried the price back above $1.09, and the next target becomes the $1.10 highs from November.
A pullback towards $1.086 might see rising trendline support from the February low tested.
GBP/USD continues to rally
The GBP/USD has also enjoyed a good bounce over the past week, which has finally carried it above the December and January highs around $1.28.
From here, a move towards $1.30 can be contemplated. Some consolidation now back below $1.28 might not dispel the bullish outlook entirely, and even a further dip towards $1.2680 would still likely test rising trendline support from early February.
USD/JPY nears 200-day moving average
The USD/JPY rally from the January low has taken a sharp knock, with the price dropping back to its lowest level since early February.
This was already underway last week but commentary from the Bank of Japan (BoJ) about an earlier than expected exit from negative rates saw the yen strengthen further, and today’s GDP data, which showed that Japan avoided a contraction in quarter 4 (Q4), has given traders further reason to buy the yen.
The 200-day SMA becomes the next target to watch for support, while below this comes the ¥145.00 level. A rebound back above ¥148.00 might provide hope that a further recovery is underway.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
