A bearish correction intensified and it made GBP/USD reach the initial support at 1.6167—the October 2011 high. If bearish bias holds further, the pair is likely to target 1.6110/1.6050 zone. 1.6050 is the 50% retracement of the move upwards from the middle of April, thus the pair could stabilize here and start a bullish rally from this level.
USD/JPY makes 2 consecutive daily attempts to start a bullish reversal, however the 80.94 resistance line has to be breached first in order to cause it. For now, the pair is likely to slip lower to the lower Bollinger band at the 79.75/50 levels, where the market could stabilised and, eventually, pair previous losses.
After the bullish advancement toward 0.9181 line (higher Bollinger band), USD/CHF failed to fix above this level and slipped lower. If the pair shows further weakness, it could hold at the 0.9066 pivot level, where it could gain support from the bullish traders.
With a relatively high 85 pip volatility, yesterday's trading session breached the prolonged the continuous low-volatility period, and gave the pair rather strong bullish impulse. A slight correction could be expected today, but the weekly outlook remains positive.
After a failure at the 5 month downtrend (around 1.3269) yesterday EUR/USD has slipped to 1.3145 this morning. After piercing the critical 80 level, Stochastic is rapidly declining to the oversold area, indicating a short term weakness and a possible slight recovery in near term. The psychological support for the pair would be in the range of 1.2995-1.3005.
A correction continues after the previous month's rally with GBP/USD having slowed to 1.6182. With controversial data from Stochastic and Relative Strength Index, a significant selloff continues on the market. Last October's high of 1.6134 could be the first potential support level.
EUR/JPY has recovered from yesterday's low of 105.125, and is now trading around 105.51 within the 1-month downward channel. Thus, a slide to the recent low of 104.61 can be expected with a strong resistance at 105.00 psychological level.
After strong bullish intraday movements yesterday, the pair has gained stronger footing today, and is trading at 80.229. Thus the nearest target for bulls is likely to be the yesterday's high of 80.61. RSI indicator is floating around the critical 30 level thus indicating a bullish correction in near-term.
USD/CHF bounced off the 0.9060/75 pivot levels after the release of the ISM Manufacturing PMI yesterday. Still, in order to establish a strong bullish trend the pair has to breach the 0.9040/50 zone (55– and 200-day MAs). A breach of these resistance levels would expose the 0.9317/42 resistance (October and November 2011 highs).
Yesterday USD/JPY managed to pair previous intraday losses, as strong ISM Manufacturing PMI report showed that the business activity is improving in the US. This bullish movement could be short-lived as the bearish bias is mostly dominating the pair. If the bearish scenario continues, traders could face the next strong support around 78.35/50 (200-day MA).
GBP/USD is still trading above the 1.6200 level—the highest level since 2008—though it declined yesterday after the US ISM Manufacturing PMI data release. This short-term correction could pull the pair back at least to the 1.6180/1.6150 levels. Stiil, from the fundamental point of view, the British pound has no basis for keeping such a strong value compared to the US dollar.
EUR/JPY recovers from yesterday's lows, though there is a high chance that before committing a proper bullish rally, the pair has to test the lower boilinger band at 105.46 first. However, if a breach takes place here, the next support at 104.46, confirmed by the 200-day MA, would be exposed.
EUR/USD remained almost unchanged since yesterday, still holding the key level at 1.3200. Although it seems bulls are losing momentum, it is too soon to speak about the trend reversal as the pair is trading above the 55-day MA. To continue the upward rally, EUR/USD has to breach a resistance around the 1.3270/85 zone, confirmed by the 200-day MA and upper bollinger band. A breakthrough here
The pair is flirting around the 0.9060/75 pivot levels as USD/CHF is going through the consolidation phase. The pair has to hold above the 0.9040/50 zone (200-day MA) in order to maintain a flat trend. A recovery off the pivotal levels (0.9060/75) would expose the 0.9317/42 resistance (October and November 2011 highs).
USD/JPY slipped lower, piercing the 80.00 psychological mark and the lower boilinger band at 80.27 respectively. Therefore, the pair is likely to continue trading in a bearish trend, thus the next strong support traders could face is located around 78.35/50 (200-day MA).
GBP/USD is still trading above the 1.6200 mark—the highest level since 2008 and yesterday it managed to hit the 1.6300 level. Yet, the pair might retrace at least to the 1.6150/1.6180 levels after such solid movement as from the fundamental point of view, the British pound has no basis for keeping such a strong value compared to the US dollar.
EUR/JPY moved lower yesterday and at the moment the pair is approaching the lower boilinger band at 105.27 and, if a breach takes place, the next support at 104.46 would be exposed, confirmed by the 200-day MA.
Yesterday the pair traded flat, indicating that bulls losing momentum, though it is too soon to speak about the trend reversal as the pair is holding grounds above the 55-day MA. However, in order to continue the upward rally, EUR/USD has to pierce a fierce resistance on the 1.3270/85 zone, confirmed by the 200-day MA and upper boilinger band. A breakthrough here would expose April (1.3310)
"There are no real underlying fundamentals that are supporting the euro at these levels. I'm fairly bearish on Spain and the broad euro zone as a whole."- Rochford Capital (based on Bloomberg)Industry outlookLast week was positive for EUR/USD, though the next barrier the pair has to test is located near 1.3287/91 zone as the 5-month downtrend and the 8-month channel.
"The latest economic statistics suggest that the international economic recovery will continue, although growth rates are likely to be on the low side by comparison with typical recovery phases"- Swiss National Bank (based on CNBC)Industry outlookAs the currency pair currently remains under the downward pressure, 0.9066—Friday's key support—is being tested at the moment. If this level is successfully pierced, 0.9000
"The amount isn't much as a percent of Japan's economy, so the impact on the yen was limited, but it "has added a slight risk-on tone to the markets in general."- Société Générale (based on MarketWatch)Industry outlookUSD/JPY is trapped between the 81.33 and 80.10 levels and if the pair fixes today below the latter level, it could expose the further
"Technically the UK is in recession but the pound has not sold off massively, which suggests maybe it has found a new range ... Sterling is benefiting from people diversifying out of euros and there aren't many choices out there."- Investec (based on Reuters)Industry outlookGBP/USD shows strong performance for the second consecutive week and it shows no signs of stopping
"Watching Spain now is exactly like watching Ireland around October 2010 before Ireland was forced into its bailout"- Roubini Global Economics (based on Bloomberg)Industry outlookEUR/JPY slumped lower last week as the market aims to stick to the near-term support level at 106.49. It might approach the 55-day MA located and higher Bollinger band around 107.80/99 and a breach here would
Given that 0.9066 is losing its status as a key support, 0.9000 and 0.8933 (200 day ma) are now in danger of being challenged. However, in case these supports are tested, positive outlook is likely to be restored and then shift focus to 0.9317/42.