EUR/USD, EUR/GBP and AUD/USD try to recover
Outlook on EUR/USD, EUR/GBP and AUD/USD.
EUR/USD dips to one-month low but tries to recover
EUR/USD's retest of the $1.0736 to $1.0766 resistance zone, up of the mid- to late December highs and mid-January low, failed at $1.0804 on Tuesday with the cross heading back down towards its current February low at $1.0656 despite hawkish comments by the European Central Bank (ECB) President Christine Lagarde, mentioning a further 50 basis point (bp) rate hike being in the pipeline.
Below $1.0656 await the early-December high at $1.0595 and the $1.0574 mid-December low which will remain in focus while this week’s high at $1.0804 caps on a daily chart closing basis.
Minor resistance below $1.0804 is seen between the early-December high and the mid-January low at $1.0736 to $1.0766.
EUR/GBP rallies on slowing UK inflation after seven consecutive days of losses
EUR/GBP's seven-day slide from its early-February high at £0.8978 has taken it to Tuesday’s low at £0.8804 before it rallied all the way back to its £0.8897 January peak on weaker-than-expected UK inflation data.
Consumer Price Inflation (CPI) fell to 10.1% year-on-year (YoY) in January, below expectations of 10.3% and 10.5% in December and by 0.6% month-on-month (MoM), the sharpest monthly decline since January 2019. Core inflation slid to 5.8%, below expectations of 6.2% YoY and 6.3% in the previous month.
A rise above the £0.8897 January peak and Wednesday’s high at £0.8902 may lead to the £0.8915 6 February low being revisited, above which towers the early-February high at £0.8978. Slips should find support between the £0.8877 late-December high and the 25 January £0.8852 high. Further support can be spotted at last week’s low at £0.8824 and this week’s low at £0.8804.
AUD/USD drops on highest unemployment rate in eight months
AUD/USD first tumbled to its 55-day simple moving average (SMA) at $0.6875 as Australia’s seasonally adjusted unemployment rate unexpectedly rose to 3.7% in January versus an expected 3.5% as was the case for its December near five-decade low. The cross then recovered, though.
For now, AUD/USD has managed to hold above its early-February low at $0.6956, a fall through which would lead to the 200-day SMA at $0.6807 being eyed. Minor resistance can be spotted at the $0.6983 late-January low.
Provided that this week’s high at $0.7029 caps, further downside is likely to be seen. If this level were to be exceeded on a daily chart closing basis, the mid-January high at $0.7063 would be back in sight, a rise above which would mean the continuation of the currency pair’s medium-term uptrend.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
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. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
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
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
