EUR/USD, EUR/GBP slide while USD/JPY continues to surge higher

EUR/USD remains under pressure ahead of busy US data calendar

EUR/USD continues to slide below its two-month downtrend line at $1.1035 towards the mid-March $1.0901 low as investors await US consumer confidence, core PCE price index and employment data and mull the latest developments of the Russia-Ukraine war which last week entered its second month.

A slip through the mid-March $1.0901 low would target the $1.0806 early March low. While the cross remains below the mid-March high at $1.1137, this year’s downtrend remains intact.

EUR/GBP trades on weaker footing

Last week EUR/GBP reached but ran out of steam slightly above the 55-day simple moving average (SMA) and 11 March low at £0.837 as UK March consumer confidence and retail sales data came in weaker than expected which pushed the EUR/GBP exchange rate higher.

Since then, it has resumed its descent towards the £0.8305 to £0.8286 region which offered support in January and February and may do so again in the days to come.

Resistance above last week’s high at £0.837 can be found between the 16 February and 25 February highs at £0.8402 to £0.8408.

USD/JPY continues to surge higher

USD/JPY is fast approaching the June 2007 high at ¥124.13, having risen by over +7% since the beginning of March as the Bank of Japan (BoJ) re-iterates its dovish stance despite inflation hitting 3-year highs while traders price in potentially aggressive rate hikes by the US Federal Reserve (FED).

The area around the June 2007 high at ¥124.13 is expected to cap the currency pair in the short term, since the last three weeks’ steep rate of ascent is most likely not sustainable. Were the ¥124.13 high to be exceeded on a daily chart closing basis, however, the June 2015 peak at ¥125.85 would be within reach.

Minor retracements may find support at the 24 March ¥122.43 high and further down between the 22 March high and 25 March low at ¥121.41 to ¥121.18.