Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY
EUR/USD: Neutral: In a 1.0500/1.0680 range.
There is not much to add as EUR traded in a relatively narrow range of 1.0568/1.0630 yesterday. However, the failure to move above 1.0630 for the second straight day and the subsequent rapid pull-back has resulted in a slight negative undertone. That said, any weakness from here is expected to face solid support at 1.0500. 1.0500 is a rather strong level and a break could lead to a quick move lower to 1.0450/55. On the upside, 1.0630 is likely strong enough to cap any short-term advance, at least for the next 1 to 2 days (next resistance at 1.0680).
GBP/USD: Neutral: Pull-back has room to extend lower to 1.2345/50.
GBP hit low of 1.2363 at the time of writing, just above the major 1.2345/50 support. While downward momentum is not exactly impulsive, the current weak undertone is still intact and a break of 1.2345/50 could lead to further extension to 1.2255/60 (with minor support at 1.2300). Only a move back above 1.2470 would indicate that the immediate downward pressure has eased.
AUD/USD: Shift from bullish to neutral: Pull-back has room to extend lower to 0.7605, possibly 0.7570.
The bullish phase that started one month ago has finally ended with the move below 0.7660 yesterday. The high of 0.7741 seen last Thursday is likely a temporary top. The current pull-back from the high appears to have scope to extend lower to 0.7605/10, possibly extending lower to 0.7570. At this stage, any decline is viewed as a corrective pull-back and a period of sustained weakness is not expected. Resistance is 0.7710 but AUD has to move above 0.7740 to indicate that the current short-term weakness has stabilized.
NZD/USD: Neutral: Increasing risk of a sustained break below 0.7130.
NZD closed on a weak note yesterday and extended its decline to hit a low of 0.7145 earlier this morning. While this level is still within the expected 0.7130/0.7260 consolidation range, downward momentum has improved considerably and the risk of sustained move below 0.7130 has increased. A break of 07130 could lead to a quick move towards the next support at 0.7070. Unless NZD can reclaim 0.7235 soon, the risk of sustained weakness would continue to grow.
USD/JPY: Neutral: Back in range, likely within 112.00/114.20.
The low of 111.67 did not quite reach the major support near 111.55/60. The subsequent strong rebound suggests that the recent short-term downward has eased and USD has likely moved back into a consolidation range, likely between 112.00 and 114.20.