Slide in EUR/USD and EUR/GBP
EUR/USD in 19-month lows, EUR/GBP probes key support and USD/CAD rallies post FOMC.
EUR/USD slips through 19-month support and nears $1.1111 to $1.1107 zone
This week’s drop in EUR/USD is the greatest seen since June 2021 with it having tumbled right through 19-month support at the $1.1168 mid-June 2020 low. The April and May 2019 troughs at $1.1111 to $1.1107 are thus next in line.
Failure at $1.1107 would engage the more significant $1.1027 to $1.0981 support region. It is comprised of the July and November 2019 lows and the April 2020 high. Further support comes in at the $1.0926 to $1.0879 September 2019 lows.
Previous support, now because of inverse polarity, resistance comes in at $1.1168 to $1.1176. Further minor resistance can be found at the $1.1186 November 2021 low.
EUR/GBP revisits multi-year key support area at £0.8313 to £0.8277
EUR/GBP continues its slide from this week’s high at £0.8423 and once more puts pressure on the broken resistance line at £0.8314. It is thus trading back in the upper reaches of its £0.8313 to £0.8277 key support area which contains the December 2016, April 2017, December 2019 and February 2020 lows. Because of the confluence of lows seen in this vicinity over several years, it is technically important and is expected to hold for now.
Should this not be the case, one would have to allow for the 200-month simple moving average (SMA) at £0.8184 to be reached. Minor resistance above the 5 January low at £0.8335 can be spotted at the 24 January low at £0.8351. While the next higher November trough and 18 and 21 January highs at £0.8377 to £0.8381 cap, downside pressure is once again prevalent.
USD/CAD’s breakthrough two-month resistance line eyes December peak at C$1.2964
In the wake of the Bank of Canada (BoC) rate decision to hold the overnight rate at 0.25% earlier this week and the US Federal Reserve’s (Fed) hawkish stance, USD/CAD cleared its two-month resistance line on its second attempt. The cross is thus aiming for its early-January high at C$1.2814 and the early December high at $1.2855. Further up key upside targets consist of the September and December peaks at C$1.2896 to C$1.2964.
Good support can be spotted between the early- and late-December lows as well as the breached resistance line at C$1.2622 to C$1.2608.
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