EUR/USD and USD/JPY push higher while GBP/USD recovery stalls
While both EUR/USD and USD/JPY are moving up, the pound’s bounce against the dollar has stalled.
EUR/USD edges towards 50-day SMA
EUR/USD continues to recover from last week’s lows, pushing back towards the 50-day simple moving average (SMA) after it managed to establish a higher low.
But the 50-day SMA has been a major barrier in the current downtrend, and we may see fresh selling pressure develop around the indicator, creating yet another lower high.
This would revive the existing downtrend and bring the $0.963 and $0.954 levels into play as potential downside targets. A move back above $1.00 might provide some short-term relief, and open the way to $1.015.
GBP/USD holds above $1.13
The financial statement from the chancellor yesterday prompted a broad recovery in the pound with GBP/USD, though gains are beginning to falter as the price approached $1.14.
It is an open question whether the price can move above $1.15, which would put it back above the 50-day SMA for the first time in months.
Nonetheless, the downtrend is still in place, and it looks like we will see a fresh leg lower in due course. This would then bring $1.10 into view, followed up by the lows of September in time, to $1.05
USD/JPY hits yet another high
USD/JPY impressive rally shows no sign of slowing. Indeed the latest run of gains have resulted in the price reaching ¥149.00, a fresh multi-decade high.
The current leg higher in the broader uptrend looks to have further to run.
Having run higher since August, the risk now is perhaps a form of intervention by Japanese fiscal or monetary authorities, which might provide the catalyst for a fresh pullback towards the 50-day SMA.
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