If the pressure intensifies any time soon, EURUSD could get back below the key 20-DMA
EURUSD failed to hold above the 1.1900 figure on Wednesday despite dollar weakness. Today, the pair made another bullish attempt around the 100-DMA but lacked the momentum and retreated back to the opening levels in recent trading. As long as the common currency remains below the 1.1900 level, downside risks persist despite the recent bounce. On the hourly charts, the euro slipped below the 20-SMA while the RSI has reversed lower again, suggesting the path of least resistance in the immediate term remains to the downside. If the pressure intensifies any time soon, EURUSD could get back below the key 20-DMA. In this scenario, the technical picture surrounding the euro would deteriorate substantially.
The cable tried to find a bottom on Thursday following two days of losses. The pair dipped to April lows around 1.3720 before bouncing slightly. Despite the recent sell-off, the pound remains above the ascending 100-DMA that acts as the key support area at this stage. On the upside, the 20-DMA (today at 1.3820) turned back into resistance. On the four-hour timeframes, the pair remains below the key moving averages since yesterday, suggesting the recovery potential could be limited in the short term. At the time of writing, GBPUSD was changing hands around 1.3735, just 0.01% higher on the day.
USDJPY is flirting with the ascending 20-DMA for the first time since February 23 as the greenback continues to retreat nearly across the board. This moving average (today around 109.40) should withstand the pressure and trigger a bounce eventually. Otherwise, the technical picture surrounding the dollar would deteriorate substantially. If so, the 109.00 figure will come back into market focus for the first time since March 25. On the hourly charts, the dollar has settled below the 20-SMA, adding to a more downbeat technical picture in the short term. A recovery above this MA that arrives at 109.70 would pave the way towards 110.00.
The Kiwi is back in positive territory on Thursday following yesterday’s decline. The pair bounced from the 0.7000 psychological level and was last seen challenging the 0.7030 region, up 0.29% on the day. Now, the prices need to get back above the 0.7050 area in order to retarget the descending 20-DMA that has been capping gains since late February. As long as the prices stay below this moving average (today at 0.7050), upside risks remain limited. In shorter-term timeframes, the technical picture looks neutral as the New Zealand dollar is stuck between the simple moving averages.
USDCAD has been trending higher for the third day in a row on Thursday, though the upside momentum has slowed in recent trading. Anyway, the pair has exceeded the 20-DMA earlier this week, suggesting the short-term technical picture could continue to improve as the moving average (today at 1.2540) now represents the key immediate support. On the other hand, the upside potential looks limited as well, with the prices struggling to make a decisive break above the 1.2600 figure. If the latest breakout is confirmed on a daily closing basis, turning this level into support, more significant gains could be expected. On the four-hour charts, USDCAD has settled above the key moving averages, adding to a fairly upbeat near-term technical picture.