It looks like the common currency could resume the downside move following some consolidation
The euro managed to bounce back above the 1.1800 figure on Monday due to broad-based weakness surrounding the dollar. Earlier today, EURUSD has encountered resistance around 1.1820 before turning flat for the day in recent trading. Now, the pair is yet to confirm the latest recovery above 1.1800 on a daily closing basis. Despite the recent upside correction, bearish risks continue to persist, and it looks like the common currency could resume the downside move following some consolidation around the current levels as the greenback remains within a strong uptrend. On the hourly charts, the euro is trying to settle above the ascending 20-SMA but the directionless RSI suggests the upside potential is limited in the immediate term as well.
GBPUSD has already erased yesterday’s gains, to turn back below the 20-DMA, today at 1.3840. Now, the cable needs to hold above the 1.3810 region in order to avoid a deeper retreat from the 1.3920 barrier seen earlier in the day. The pound also needs to see a robust and sustainable recovery above 1.3900 on a daily closing basis to retarget the 1.4000 psychological level last seen on March 18. In the immediate term, the path of least resistance is to the downside, especially as the daily RSI is pointing lower again while the mentioned moving average continues to act as resistance. GBPUSD was last seen trading at 1.3832, down 0.46% for the day.
USDJPY briefly slipped below the 110.00 figure on Monday but managed to close the day above this level. Today, the pair regained upside momentum and was last seen flirting with the 110.50 intermediate resistance, a decisive break above which would pave the way towards the 111.00 key barrier that capped gains last week. Also on the positive side, the prices have been holding above the ascending 20-DMA since early January, representing a strong support zone, today at 109.40. On the four-hour charts, the dollar was last seen challenging the 20-SMA while the RSI was pointing north, suggesting USDJPY could extend the ascent in the short term and climb back to the mentioned target eventually.
The Kiwi turned negative on Tuesday following four consecutive days of gains. The pair once again failed to challenge the 20-DMA that has been acting as resistance since late January. Now, the prices are threatening the 0.7000 figure, a break below which would pave the way towards November lows seen around 0.6940 last week. On the hourly charts, NZDUSD is now below the 20- and 100-SMAs while targeting the 200-SMA that arrives just at the 0.7000 figure. On the upside, the pair needs to regain the 0.7050 area in order to retarget the 20-day moving average that arrives at 0.7080 today.
USDCHF managed to hold above the 20-DMA during the recent decline, to turn back positive on Tuesday. The pair bounced from nearly two-week lows around 0.9350 but still failed to regain the 0.9400 figure that now represents the key hurdle for dollar bulls. It looks like the prices could struggle to see a more robust ascent in the short term while in general, the broader technical picture remains upbeat, with the greenback is marginally off mid-2020 highs seen around 0.9470 last week. Furthermore, the mentioned moving average (today at 0.9333) has been acting as support for three months already and will likely continue to do so.
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