EUR/USD, GBP/USD and AUD/USD look to continue their bullish two-month trend
EUR/USD, GBP/USD and AUD/USD look set to continue their bullish momentum, with recent worries cast aside for now.
EUR/USD continues to push higher after recent pullback
EUR/USD has seen a more upbeat tone over the second half of the week, with the dollar strength seen on Monday and Tuesday fading to give way to another push higher for this pair. Markets appear to be in a state of flux, with inflationary concerns reemerging in the wake of last Friday’s jump in US average earnings. Today sees the release of the US producer price index (PPI) inflation figure, bringing potential volatility if we see factory prices head higher.
China certainly has little to worry about on that front, with both consumer price index (CPI) (1.6%) and PPI (-1.3%) well below target thanks to cheap Russian fuel and lockdown restrictions. For EUR/USD, we would need to see a move back below the $1.029 swing-low to bring about a fresh bearish signal after two-months of upside for the pair. Until then, the bulls remain in the driving seat.
GBP/USD pushing back into key resistance
GBP/USD also saw a somewhat downbeat start to the week, with the pair heading lower from the crucial $1.2293 swing-high resistance level. That August high provides a crucial hurdle up ahead for bulls, with a push through that point bringing expectations of another leg higher from here.
The uptrend in place over the course of the past two-months has brought expectations of further upside unless we see that ongoing pattern of higher lows end. With that in mind, a bullish view holds unless the price falls back below the $1.19 level. Keep an eye out for the UK consumer inflation expectations figure released at 9.30am this morning.
AUD/USD struggling to maintain recovery pace
AUD/USD has similarly been attempting to regain ground today, with the gains seen across EUR/USD and GBP/USD failing to carry through here. This could signal a potential waning of the bullish momentum, with the fact that these pair have been slowing in their ascent of late serving to highlight the potential for another bearish reversal in the near-future.
That would tally up with what is happening in equity markets, which have shown initial tentative signs of a turnaround before long. With that in mind, watch out for a break back below the $0.664 level to signal a bearish turn for this pair. Until then, the uptrend evident over the past two-months does remain in play.
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