A decisive break above 1.2180 would send the euro to the 1.2200 barrier last seen in mid-January
The euro briefly rose to one-month highs around 1.2180 earlier in the day. However, the pair failed to preserve gains and turned red on the daily charts during the European hours. AS of writing, EURUSD was changing hands marginally below the 1.2150 area. If the prices fail to regain this figure in the immediate term, the market focus would shift back to the 1.2100 handle, just below which the 20-DMA lies. On the upside, a decisive break above the mentioned highs would pave the way towards the 1.2200 barrier last seen in mid-January. As the daily RSI looks directionless in the neutral territory, it looks like the downside pressure would stay modest in the short term.
GBPUSD extends its gradual and solid ascent on Tuesday. The pair rallied to fresh April-2018 highs just below the 1.4100 figure while retaining upside bias during the European hours. Of note, the daily RSI has exceeded the 70 threshold, to enter the overbought territory for the first time since last August suggesting a bearish correction could take place soon. In this scenario, the cable will first target the 1.4000 psychological level, a decisive break below which could bring more aggressive profit-taking in the coming days. Otherwise, the pound would pierce the 1.4100 barrier, to set fresh long-term highs.
USDJPY saw a dip to one-week lows earlier in the day. In the process, the pair briefly slipped under the 105.00 figure that triggered a bounce. As a result, the dollar regained the 20-DMA and settled around 105.30 in recent trading. Despite the recent recovery, the upside potential surrounding the greenback remains fragile, with bearish risks persisting, especially as the pair is trading below the 200-DMA that arrives in the 105.50 zone, representing the immediate resistance now. On the hourly timeframes, USDJPY is now stuck between the 20- and 200-SMAs while the RSI is pointing north in the neutral territory, suggesting the dollar could continue bullish attempts in the near term.
The Kiwi looks directionless on Tuesday after yesterday’s jump to fresh April-2018 highs. The pair peaked around 0.7340 while staying above the 0.7300 figure today. The fact that the prices refrain from a bearish correction may be a sign of their readiness to extend the ascent, especially as the daily RSI hasn’t entered the overbought territory just yet. In the immediate term, the pair needs to hold above the 0.7300 figure in order to avoid a deeper pullback. On the four-hour charts, there are some signs of waning upside momentum, suggesting the pair could retreat in the near term before another bull run takes the pair to fresh long-term highs.
The Aussie briefly peaked at fresh three-year highs around 0.7935 early in Asia before retreating. As a result, the pair turned negative on the day and was last seen trading just below the 0.7900 figure. Despite the correction from peaks, the Australian dollar continues to retain a strong bullish bias in a wider picture and could target fresh highs after a pause. The next significant target for buyers arrives at 0.8000. In the short term, AUDUSD needs to hold above the 0.7870 area in order to avoid a more aggressive downside correction. On the four-hour charts, the pair is losing upside steam but still remains above the 20-SMA that arrives at 0.7855.