EUR/USD declining and USD/JPY holding firm, while GBP/USD begins to show signs of a higher low
Dollar strength continues to hit EUR/USD, while USD/JPY is holding on to its recent gains. Meanwhile, the pound is showing signs of a recovery against the dollar.
EUR/USD still in full retreat
Losses continue in the pair EUR/USD, as the dollar gathers strength and expectations of a Federal Reserve rate hike in June continue to rise. While leaders in Washington have agreed the outline of a deal, a successful ratification is still uncertain.
Having fallen below trendline support and below the 50- and 100-day simple moving averages (SMAs), the price now targets the March lows around $1.053. Below this the 200-day SMA comes into view.
The sellers have had it all their own way since the beginning of the month, with intraday lower highs signalling continued bearish pressure. It would need a move back above $1.082 to begin to suggest that a revival is in play.
GBP/USD begins to edge higher
There has been some stabilisation here, in GBP/USD, with the price edging higher off last week’s lows.
A close above $1.24 would help to bolster the view that a higher low has been formed and that the cycle of declines from May’s high has run its course. This might then open the way to a renewed push to the highs of May around $1.266.
A failure to hold the gains from Friday might then open the way to further declines to the 100-day SMA and lower.
USD/JPY sits near seven-month high
The pair USD/JPY's strong run continues, as flows head back to the US dollar despite the debt ceiling crisis.
The pair has now risen to its highest level since November, and has enjoyed a powerful move higher. Some consolidation may now follow, but it would need a move back below ¥137.00 to provide an indication that the sellers are in control once again.
Additional upside targets the November 2022 high at ¥142.30.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. 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. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Start trading forex today
Find opportunity on the world’s most-traded – and most-volatile – financial market.
- Trade spreads from just 0.6 points on EUR/USD
- Analyse with clear, fast charts
- Speculate wherever you are with our intuitive mobile apps
See an FX opportunity?
Try a risk-free trade in your demo account, and see whether you’re onto something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See an FX opportunity?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from just 0.6 points on popular pairs
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See an FX opportunity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
