The euro has settled below the 20-weekly SMA for the first time since early-November
EURUSD has been losing ground for the third day in a row on Tuesday. The pair breached the 1.2000 psychological support for the first time in four weeks, to register fresh lows in the 1.1990 area before bouncing slightly. Dollar demand dominates the markets as stocks struggle for direction despite the bond market rout has abated. A daily close below 1.2000 would mark further deterioration in the short-term technical picture, but the overall bullish trend remains intact as long as the world’s most popular currency pair stays above 1.1600. Of note, the euro has settled below the 20-weekly SMA for the first time since early-November when the prices managed to stage a bounce eventually.
The cable is flirting with the 20-DMA for the first time in a month today, giving up previous gains amid a widespread rally in the greenback. However, the pair refrains from a more aggressive retreat and has settled at critical levels now. A symmetrical triangle was created on the daily charts, and should the mentioned moving average withstand the pressure, a bounce could be expected. At the time of writing, GBPUSD was trading at 1.3880, after failed attempts to hold above the 1.3900 figure. Should the dollar extend the rally any time soon, the mentioned triangle breakdown would pave the way towards the 1.3760 area that could cap further losses as this area acted as strong resistance earlier this year.
USDJPY keeps rallying for the sixth consecutive day. The dollar climbed to late-August highs just below the 107.00 figure that now represents the key target for bulls. If the pair is rejected from here, a downside correction could be expected, but downside risks look limited at the moment despite the daily RSI was last seen flirting with the 70 threshold. The technical picture on the four-hour timeframes looks upbeat as well, with the prices trading well above the ascending 20-SMA while the RSI hasn’t entered the overbought territory just yet. Even if the 107.00 figure gives up, the 100-weekly SMA around 107.25 should cap further bullish attempts in the near term.
USDCHF has been rising since mid-February, extending gains to early-November highs just below the 0.9200 handle on Tuesday. The pair has retreated marginally since peaking at 0.9193 earlier in the day but still retains a robust bullish bias following a break above the descending 200-DMA that now acts as the immediate significant support around 0.9135. On the other hand, the daily RSI has settled in the overbought territory while short-term bullish momentum has been abating, suggesting the pair will hardly be able to make a decisive break above 0.9200 any time soon. It is possible that USDCHF will make another bullish attempt following a local downside correction.
USDCAD regained upside momentum following a retreat witnessed at the start of the week. Still, the pair lacks the impetus to make a decisive break above the 20-DMA (today at 1.2680) while the key immediate upside target arrives at 1.2700. As long as the prices stay below this level, downside risks persist despite the recent bounce. In a wider picture, USDCAD remains within a broader downtrend while being capped by the 20-weekly moving average since June 2020. The pair was last seen trading at 1.2670, up 0.19% on the day and just below the mentioned daily SMA. On the downside, the immediate support now arrives at 1.2640, followed by the 1.2585 area.