Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY
EUR/USD: Neutral: In a 1.0500/1.0680 range.
The short-term downward pressure has eased with the move back above 1.0620 yesterday (high of 1.0630). Indicators are mostly flat now and EUR has likely moved into a consolidation range, expected to be between 1.0500 and 1.0680. The price action near the extremes of the range should provide better clues of the next sustained directional move but at this stage, the outlook is unclear.
GBP/USD: Neutral: Pull-back has room to extend lower to 1.2345/50.
As highlighted yesterday, the sharp pull-back from last Friday’s 1.2570 peak has shifted the immediate pressure to the downside. The short-term weakness is expected to extend lower to the month-to-date low near 1.2345/50. Based on the current momentum, a sustained move below this level appears unlikely. Overall, only a move back above 1.2505 would indicate that the immediate downward pressure has eased
AUD/USD: Bullish: Shift to neutral unless daily closing above 0.7710 today.
AUD tried but failed to move above the 0.7710 resistance mentioned yesterday (high of 0.7708). Unless there is a daily closing above 0.7710 by end of today’s NY session, we would consider the bullish phase that started early this month has ended . Alternatively, a break below 0.7660 would also indicate that AUD has moved into a consolidation phase.
NZD/USD: Neutral: Back in range, likely between 0.7130 and 0.7260. [No change in view]
NZD eased off quickly without testing the major 0.7290 resistance (high of 0.7238 last Friday). The short-term upward pressure has eased and this pair has likely moved back into a consolidation phase, likely between 0.7130 and 0.7260.
USD/JPY: Neutral: Room for a test of major 111.55/60 support.
USD retested last Friday 111.91 low but rebounded strongly after touching 111.89. Despite the recovery, the undertone is still negative and there is still room for another leg lower to test the major 111.55/60 support (even though the odds have diminished). At this stage, a sustained move below this major support seems unlikely. On the upside, only a clear move back above 113.00 would indicate that the short-term downward pressure has eased.