EUR/USD trades in 15-month highs, USD/JPY in six-week lows while EUR/GBP stabilises
Outlook on EUR/USD, EUR/GBP and USD/JPY post softening U.S. inflation data.
EUR/USD nears its March 2022 peak
EUR/USD swiftly extended its gains and rose for a fifth consecutive day, propelled higher by softer-than-expected U.S. inflation.
With consumer price inflation (CPI) for June coming in at 3% Year-on-Year (YoY) and core at 4.8% YoY Federal Reserve (Fed) rate hike expectations have greatly diminished, provoking a U.S. dollar sell-off which benefited the euro.
EUR/USD is approaching its March 2022 peak at $1.1185, now that it has risen above its $1.1095 April high which, because of inverse polarity, should now act as minor support.
EUR/GBP bounces off its 11-month low
EUR/GBP recovered from its £0.8504 current July low, last traded in August 2022, and did so as the British economy contracted by 0.1% Month-on-Month (MoM) in May, following 0.2% growth in April but compared to an anticipated bigger decline of 0.3%.
EUR/GBP thus has Monday’s high at £0.8584 in its sights, above which the April-to-July downtrend line can be seen at £0.8604. This may well cap again, though.
Minor support can be found around the 23 June low at £0.8536.
USD/JPY drops more than 4% over five consecutive days
This week’s ongoing U.S. dollar weakness accelerated on the back of a softer U.S. inflation print on Wednesday with USD/JPY slipping through its 55-day simple moving average (SMA) and its March-to-July uptrend line at ¥139.64 to ¥139.16 respectively.
The breached uptrend line, because of inverse polarity, is now expected to act as a resistance line, as should the 55-day SMA.
Downside targets are to be found at the ¥137.77 early-May peak and also along the 200-day SMA at ¥138.08.
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
