Sharp losses for GBP/USD following inflation print, while USD/JPY rises and EUR/USD holds steady
The pound has dropped sharply against the dollar following a slowdown in UK inflation growth, while the dollar is making headway against the yen and EUR/USD is holding steady.
EUR/USD steady around $1.12
EUR/USD gains have stalled after the impressive run higher earlier in the month, leaving the uptrend firmly intact after today’s higher high.
Bulls will be pleased with the renewed strength of the trend, which rewarded dip buyers with a 300 point move to the upside. Additional gains over the medium term now target $1.15, last seen in the first two months of 2022.
A pullback towards the 50-day simple moving average (SMA) may develop in coming weeks, but as yet there is little sign of any retracement.
GBP/USD slumps after inflation print
GBP/USD's similar picture prevails here, after the surge from the second half of June.
Sellers have been able to trim some of the gains, but the pair has still reached a new higher high. A deeper pullback might target $1.28 and then trendline support from the March low.
A revival targets $1.33, though with the price looking stretched in terms of its distance from the 50-day SMA a period of consolidation would not be surprising.
USD/JPY pushes on above ¥139.00
USD/JPY low looks to be forming here as the price steadies itself above ¥138.00 and the 200-day SMA, after the swift pullback from the June highs.
Having arrested the decline, the next move would be a recovery of ¥140.00 that might allow the price to target the ¥145.00 level again in due course, and potentially move on to create a new higher high.
The short-term pullback appears to have run its course, but a drop back below ¥137.00 would negate this bullish outlook.
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
