If USDCAD fails to hold above 1.3000, the prices could threaten more than two-year lows registered around 1.2930 earlier this month
EURUSD resumed the ascent after a short-lived retreat seen on Monday when the pair was briefly rejected from the levels just above the 1.1900 handle. The common currency faced hurdle in the 1.1890 area once again and trimmed intraday gains ahead of the opening bell on Wall Street. As of writing, EURUSD was trading at 1.1867, up 0.23% on the day. Despite the euro remains within the upward trend amid the prevailing dollar weakness, it still lacks the bullish momentum to make a decisive break above the important hurdle. If the pair fails to overcome the 1.1900 resistance on a daily closing basis, a correction could take place. In this scenario, the 1.1850 and 1.1830 figures could act as local support levels on the way towards 1.1800.
GBPUSD continues its gradual and cautious ascent on Tuesday. The pair retains a modest upside bias but refrains from challenging early-September highs registered just below the 1.3400 figure. This level now represents the key immediate resistance for bulls that could turn into support if the dollar stays on the defensive in the days to come. On the positive side, the prices remain well above the ascending 20-DMA while the daily RSI continues to point higher but is yet to reenter the overbought territory, suggesting there is room for further upside at this stage. On the four-hour charts, the cable needs to hold above the 20-SMA in order to retain the current upside bias.
USDJPY bounced strongly on Monday and remained close to one-week highs today, struggling to challenge the 103.65 local resistance. Despite the fact that the greenback reclaimed the 20-DMA as support in the process, downside risks persist as the recent recovery could be unsustainable and attract the selling interest instead. If so, the pair could retarget the 104.15 area again and threaten the 104.00 figure as a result. On the upside, a daily close above 105.10 is needed to confirm a reversal and pave the way to further gains in the short- to medium-term. In a wider picture, the greenback continues to follow the descending 20-weekly MA, today at 105.35.
The cross sees strong gains since the start of the week amid broad-based risk-on sentiment across the global markets, capping demand for the safe-haven Japanese yen. In recent trading, the pair derailed the 100-DMA and exceeded the 124.00 figure while the daily RSI turned higher as a result. These developments could be a sign of the improving technical picture and the room for further upside at least in the short term. However, the euro is yet to confirm the latest breakout on a daily closing basis and reclaim the mentioned moving average as support in order to extend gains. Otherwise, a bearish correction could be expected.
USDCAD has been capped by the descending 20-DMA for the last three weeks already which could be a sign of the increasing selling pressure in the longer run. On Tuesday, the pair briefly dipped to nearly two-week lows marginally above the 1.3000 handle but managed to erase most of the daily losses in recent trading. Despite the bounce, the US dollar remains on the defensive and could threaten the mentioned psychological support as recovery attempts facing the selling interest while the mentioned 20-DMA continues to act as strong resistance. If USDCAD fails to hold above 1.3000, the prices could threaten 1.2980, followed by more than two-year lows registered around 1.2930 earlier this month. On the upside, the immediate resistance arrives at 1.3085, followed by 1.3100 and the 1.3120 region where the 20-DMA lies.