EURUSD rose to four-month highs around 1.1450 on Wednesday, extending its winning streak to a fourth day already. The pair has settled in the upper end of the extended range, suggesting the upside potential persists. The euro could challenge the 1.15 handle if the mentioned resistance gives up in another bull run. On the other hand, the daily RSI is nearing the overbought territory which may mean that the upside momentum could start fading soon. On the short-term timeframes, the RSI has settled around the 70 mark, adding to signs of an impending downside correction following a strong rally.
GBPUSD bounced strongly from recent lows below 1.25 and stopped just shy of the 1.2650 intermediate resistance area. Despite the heightened volatility, the cable remains stuck in a familiar range between the key moving averages that act as resistance and support levels, respectively. On the upside, the 200-DMA arrives marginally below 1.27. This figure capped bullish attempts recently. On the downside, the 50- and 100-DMAs converge around 1.2440. as long as the pound stays between these lines, its dynamics is considered neutral. In short-term timeframes, the technical picture looks more positive.
USDJPY closed at the 20-DMA on Tuesday that triggered a downside rejection during today’s trading. The pair plunged below 107.00 but refrained from deeper losses to fresh July lows last seen late last week around 106.60. As long as the dollar remains above this level, downside risks are limited. On the other hand, the daily RSI turned lower, suggesting the selling pressure could persist for some time before dollar demand picks up again. On the upside, the par needs to make the 20-DMA into support again in order to challenge the 100-DMA around 107.55.
The Kiwi bounced from 1.5-week lows registered yesterday around the 0.65 handle and turned positive on Wednesday. The pair managed to shrug off recent weakness but the upside impetus looks too modest to expect a more robust ascent at least in the immediate term. On the other hand, a fairly long lower wick created on the daily timeframes yesterday suggests bearish risks are limited as well. On the positive side, the daily RSI has reversed north while the 50- and 200-DMAs have made a bullish cross. It could be a signal of the impending ascent after some hesitation.
USDCAD climbed to fresh July highs marginally below 1.3650 yesterday but failed to preserve the upside momentum and turned into a corrective mode on Wednesday. As a result, the pair retreated to 1.3550 and remains below 1.36 despite a local bounce. In a wider picture, the dollar has been in a consolidative mode for over a month already, and it looks like the pair is not ready for a breakout at this stage. On the downside, there is significant support around 1.35 where the 200-DMA arrives. As long as the prices stay above this level, downside risks are limited. Meanwhile, the daily RSI is pointing slightly lower, suggesting the greenback will remain on the defensive in the short term.