In a wider picture, the common currency retains its bullish tone as long as the prices stay above the ascending 100-DMA
EURUSD
EURUSD is back on the offensive after two days of a bearish correction from long-term highs. Despite the upside bias, the bullish potential in the pair is limited as the risk-on tone has waned somehow since the start of the week. In the short term, the pair needs to hold above the 1.2070 area in order to stay elevated above the 1.2000 figure. In a wider picture, the common currency retains its bullish tone as long as the prices stay above the ascending 100-DMA, today at 1.1815. On the upside, the key hurdle for buyers arrives at 1.2180, followed by the 1.2200 barrier. On the four-hour charts, recent recovery attempts in the EURUSD pair were capped by the 20-SMA that arrives around 1.2130. Meanwhile, the daily RSI has settled around the 70 figure, suggesting the upside potential is limited at this stage.
GBPUSD extends the retreat from recent peaks on Tuesday. The pair has settled just above the 20-DMA at the time of writing, barely holding above the 1.3300 figure. Yesterday, the cable briefly dipped to the 1.3225 region but managed to erase most of the intraday losses by the end of trading. Both signs suggest the bearish risks could be limited at the moment. However, if the pound fails to hold above the 1.3300 level in the short term, the technical picture could deteriorate further. In this scenario, the 20-DMA will turn into resistance and could pave the way towards 1.3200. On the upside, a recovery above 1.3420 will signal fresh highs could lie ahead.
USDJPY
USDJPY regained a modest upside bias on Tuesday while still being capped by the 20-DMA, today around 104.30. The pair continues to oscillate around the 104.00 handle, struggling for direction amid mixed sentiment in the global financial markets. However, in a wider picture, the pair remains on the defensive while staying within a broader downtrend, with the descending 100-DMA has been capping bullish potential since June 2020. On the hourly timeframes, the dollar is stuck between the 20- and 100-SMAs, pointing to the persisting consolidative pattern in the short term. At that, the RSI in the same charts is pointing slightly lower, which implies that USDJPY could yet see a daily close below 104.00.
The cross continued to push higher on Tuesday after a bounce from the 100-DMA, today at 0.9035. The euro was flirting with the 0.9100 figure at the time of writing. A break above this local hurdle on a daily closing basis could pave the way towards yesterday’s highs around 0.9140 last seen in October. The daily RSI is pointing north while the prices stay well above the key moving averages, suggesting upside risks could persist in the short term. On the downside, the immediate significant support is represented by the mentioned 100-DMA, followed by the 0.9000 psychological handle. On the four-hour timeframes, the short-term technical picture has improved after the recent bounce from the ascending 20-SMA.
EURJPY
EURJPY dipped to nearly one-week lows in the 125.85 area earlier in the day but managed to bounce and turned positive on the daily charts during the European hours. As such, the cross climbed to intraday highs around 126.25 and has settled above 126.00 since then. Now, as the euro is back above this level, last Friday’s highs last seen in early-September could come back into market focus. On the hourly charts, the key upside hurdle is now represented by the 100-DMA, today at 126.25, while on the downside, the descending 20-SMA is acting as the immediate support just above the 126.00 figure. In a wider picture, the technical outlook for the pair has improved following a break above the 200-weekly MA in November.
