EUR/USD, EUR/GBP mixed while USD/JPY stalls amid highest Tokyo CPI reading since April 2019
EUR/USD and EUR/GBP continue to trade sideways in low volatility while USD/JPY pauses its steep ascent in 6-year highs.
Loss in volatility is seen in the EUR/USD cross
EUR/USD continues to trade sideways below its two-month downtrend line at $1.1051 as investors remain cautious about the latest developments of the Russia-Ukraine war which is now in its second month.
A slip through this week’s low at $1.0961 would target the mid-March $1.0901 low, a fall through which would lead to the $1.0806 early March low being back in play.
While the cross remains below last week’s high at $1.1137, this year’s downtrend remains valid.
![EUR/USD chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/content-2-chart-images/25032022_EURUSD-Daily.png/jcr:content/renditions/original-size.webp)
EUR/GBP recovery ongoing after UK March GfK consumer confidence hits 16-month low
EUR/GBP is seen heading towards the 55-day simple moving average (SMA) and 11 March low at £0.8361 as UK March GfK consumer confidence came in weaker than expected at -31, its weakest level in 16 months, amid mounting concerns about surging inflation, higher interest rates and the ongoing war in Ukraine. This compared to -26 in February and an expectation of -30 for March.
Furthermore, UK month-on-month (MoM) retail sales surprised to the downside by dropping to -0.3% versus an expected +0.6% and +1.9% previously which pushed the EUR/GBP exchange rate higher.
Resistance above the 55-day SMA can be spotted between the 16 February and 25 February highs at £0.8402 to £0.8408. Support remains to be seen in the £0.8305 to £0.8286 region which held in January and February.
![EUR/GBP chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/content-2-chart-images/25032022_EURGBP-Daily.png/jcr:content/renditions/original-size.webp)
USD/JPY stalls at resistance after three weeks of sharp gains
USD/JPY is heading for its third week of sharp gains and has so far risen to ¥122.43 as the Bank of Japan (BoJ) sticks to its dovish stance despite inflation hitting 3-year highs while traders price in potentially aggressive rate hikes by the US Federal Reserve (FED).
In the wake of yesterday’s Tokyo Core year-on-year (YoY) consumer price index (CPI) rising at its fastest pace since April 2019 to +0.8%, the currency pair stalled marginally above the ¥122.20 January 2007 high. A minor retracement may thus be seen over the coming days but could be used as an opportunity to enter a long trade.
Minor support below the 22 March high at ¥121.41 comes in around the psychological ¥120.00 mark. Were this week’s high at ¥122.43 to be exceeded, the November 2015 peak at ¥123.75 would be eyed next, ahead of the June 2015 peak at ¥125.85.
![USD/JPY chart](http://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/content-2-chart-images/25032022_USDJPY-Daily.png/jcr:content/renditions/original-size.webp)
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