EUR/USD, GBP/USD stall while USD/JPY appreciates further
Outlook on EUR/USD, GBP/USD and USD/JPY as Japan inflation drops to 17-month low.
Subdued EUR/USD continues to range trade
EUR/USD's slide from last week’ s high around the $1.10 mark due to pared back rate cut expectations found support along the 200-day simple moving average (SMA) at $1.0847 which held the cross throughout this week.
Further sideways trading between the 55- and 200-day SMA and Wednesday’s low and Thursday’s high at $1.0845 to $1.0906 remains at hand.
While the December to-January downtrend line at $1.0917 isn’t bettered, medium-term downside pressure should prevail.
GBP/USD recovery nipped in the bud by weak UK retail sales
GBP/USD's rise off this week’s low at $1.2597 on differing rate cut expectations between the US and the UK has taken the cross to Friday’s $1.2714 intraday high before it gave back some of its recent gains on UK retail sales falling the most in nearly three years.
Significant support for the currency pair remains to be seen between the late December to January lows at $1.2612 to $1.2597.
Resistance above $1.2714 is to be found at the 22 December high at $1.2744. Further up lie the 2 and 11 January highs at $1.2760 to $1.2786.
USD/JPY continues its ascent
USD/JPY has risen to a new six-week high at ¥148.80 as Japanese inflation eased to a 17-month low.
Next up are the late November highs around ¥149.75 and the psychological ¥150.00 mark. If overcome, the November peak at ¥151.91 would be back in the frame.
Minor support below Thursday’s ¥147.66 low sits between Tuesday’s high and Wednesday’s low at ¥147.31 to ¥147.10. Further down the area between the 5 and 11 January highs and the 55-day SMA at ¥146.41 to ¥145.99 provides more solid support.
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