EUR/USD and GBP/USD drop back while USD/JPY bounce stalls
The dollar continues to recover following Friday’s non-farm payrolls, pushing down EUR/USD and GBP/USD while lifting USD/JPY.
EUR/USD edges higher off 50-day SMA
A revival of dollar strength has seen the uptrend in EUR/USD take a knock.
The price has retreated swiftly over the past three sessions towards the rising 50-day simple moving average (SMA), setting up a possible higher low if a rebound develops. This then reinforces the bullish view and puts a move back to $1.10 into play.
Continued losses below the 50-day SMA would then target the early January low around $1.05.
GBP/USD decline slows
Price action here with GBP/USD has seen the pair drop back below the 50-day SMA, and with a second failure to break the $1.24 level in two months now in a more bearish view may start to prevail.
If the 200-day SMA is lost then the January low around $1.187 is possible support, followed up by $1.18 itself.
Below this a more bearish view begins to take hold, and suggests a reversal of the gains made since the end of September.
USD/JPY drops back from 50-day SMA
The week began with fresh gains for USD/JPY after Friday’s recovery, pushing back to the 50-day SMA for the first time since November.
The steady move lower since November has not seen much in the way of a rebound, so now sellers will wait to see how far this bounce goes. Moves higher in December stalled around ¥134.40, so if this can be cleared then the 200-day SMA comes into view.
A reversal back below ¥131.00 could suggest that a lower high has been created, and that a move towards the January lows around ¥127.70 is now in progress.
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