EUR/USD, GBP/USD and NZD/USD turn upwards as dollar strength eases
EUR/USD turning upwards after recent pullback
EUR/USDhas started to turn upwards following a pullback that took price back down towards the $1.0198 support level. This morning has seen improved Purchasing Managers Index (PMI) numbers out of France and Germany, with French services bringing the only sector which has started to weaken across the four readings.
The recent push up through the $1.0198 swing-high brings expectations of a potential period of upside for the pair. However, it makes sense to await a break up through the $1.0481 resistance level to confirm that we have seen the end of this pullback. Until we see that upside resistance level taken out, it makes sense to remain aware of the potential for further short-term downside.
GBP/USD consolidating after period of upside
GBP/USD has been consolidating since reaching a three-month high last week, with this pair trading sideways ever since. The rise through trendline resistance brings expectations of further upside, although $1.2293 remains a significant upside hurdle of note.
Keep an eye out for the UK manufacturing and services PMI readings later on this morning, with the FOMC minutes due in the evening. For now, a push up through the $1.2029 resistance level would be required to bring about a fresh buy signal.
NZD/USD pushes higher after rate rise
NZD/USD has been an outperformer over recent weeks, as the continued push higher in interest rates from the RBNZ helps lift the pair. Interestingly, we have seen a clear divergence between Australian and New Zealand rates, as highlighted by the 75-basis point (bp) hike overnight. The fact that the RBNZ are quickening their tightening pace as many other central banks slow down has brought a spotlight on the NZD.
With that in mind, there is a good chance of further near-term upside, with $0.6242 providing the next upside hurdle. However, the wider downtrend does still remain intact, with a push up through the $0.6468 swing-high required to negate that trend.
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