EUR/USD, GBP/USD and AUD/USD rally as US dollar slips further
Outlook on EUR/USD, GBP/USD and AUD/USD as US dollar dives on back of softer US PPI data.
EUR/USD trades in 13-month highs on weaker-than-expected US March PPI numbers
EUR/USD is on track for its fourth consecutive day of higher levels as it hit a 13-month high amid a rapidly depreciating US dollar on the back of US March producer prices which came in at a weaker-than-expected -0.5% month-on-month (MoM) versus an expected 0%. This data points to the possibility of a Federal Reserve (Fed) funds pivot at 4.75% to 5.00%.
The January 2022 low and early-March 2022 high at $1.1121 to $1.1122 are now in focus.
Minor support below the $1.1033 February peak and the minor psychological $1.10 mark can be spotted around the $1.0973 early-April high. Further minor support comes in at the $1.0929 late-March high.
GBP/USD rallies to ten-month high
GBP/USD recovery rally from Monday’s $1.2345 low has taken it to a ten-month high above the early-April high at $1.2525 with the May 2022 peak at $1.2667 being eyed while the greenback continues to slide on weaker-than-expected March producer price index (PPI) data which raises hopes that the Fed may move away from its tightening cycle.
Support remains to be seen between the December and January highs at $1.2448 to $1.2446, above the March-to-April support line at $1.244. Further down lies minor support at Tuesday’s $1.2386 low ahead of Monday’s $1.2345 trough.
AUD/USD rally extends on weaker US dollar and amid a rising gold price
AUD/USD is flirting with its 55-day simple moving average (SMA) at $0.6779, close to its early-April high at $0.6793, as US dollar weakness continues amid weaker March consumer price index (CPI) and PPI readings which point to a possible end of the Fed’s monetary tightening policy.
While no daily chart close above the $0.6793 high is seen, a slip back towards the 200-day SMA at $0.6745 looks probable with the mid-March high at $0.6717 possibly also being reached.
Were resistance at $0.6793 to give way, though, the mid-February $0.6812 low would be targeted, followed by the early-December high, mid-January and early-February lows at $0.685 to $0.6872.
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