It looks like the Australian dollar will keep struggling in the short term while recovery attempts would be limited
The euro plunged on Wednesday as the dollar rallies across the board. Treasury yields are back on the rise while risk aversion persists in the global financial markets, fueling demand for the safe-haven greenback. As such, EURUSD dipped to fresh mid-2020 lows around 1.1530, threatening the 1.1500 figure now. Earlier in the week, the common currency extended recovery to the 1.1640 area but failed to preserve upside momentum and came under renewed selling pressure. If the mentioned long-term lows give up in the short term, the 1.1500 figure would come into the market focus. Despite the RSI has entered the oversold territory, it looks like the EURUSD pair could continue to lose ground as the dollar remains elevated, targeting fresh 2021 tops.
The cable climbed to the 1.3650 area on Tuesday to finish higher for the fourth day in a row. However, as dollar demand reemerged, the pair had to give up previous gains and slipped to into the negative territory. The prices extended the downside correction to the 1.3543 figure before trimming intraday losses during the European hours. Now, GBPUSD needs to hold above the 1.3530 region in order to hold above the 1.3500 figure in the short term. Should this support zone give up, the recent late-2020 lows around 1.3410 would come back into the market focus. On the upside, the immediate resistance arrives at 1.3600, followed by the 1.3630 region and the descending 20-DMA, today at 1.3670. On the hourly charts, the pound was last seen flirting with the 200-SMA, with the technical picture looking neutral at this stage.
USDJPY erases losses seen in the second half of last week. The pair extended gains to 111.80 but failed to get back to the 112.00 region and slipped back to the flat-line during the European hours. the dollar needs to regain the 111.50 region on order to resume the ascent towards early-2020 highs just above the 112.00 mentioned figure. It is possible that the greenback would face another bearish correction in the coming days to attract fresh buying pressure and overcome the 112.00 figure eventually. On the downside, the immediate support arrives at 111.35, followed by the 111.00 figure and the 110.80 key barrier for dollar bears.
USDCAD was losing ground for four days in a row before reversing north on Wednesday. The pair bounced from one-month lows around 1.2545 to regain the 1.2600 figure. The prices extended the recovery to the 1.2650 area before retreating slightly in recent trading. It looks like the dollar could lack upside momentum to get back above the 20-DMA, today at 1.2680, in the short term. On the other hand, downside risks are limited as long as the prices stay above the 200-DMA that arrives at 1.2515. If the 1.2650 region continues to act as resistance on a daily closing basis, USDCAD could resume the recent decline towards the mentioned moving average.
The Aussie is back under pressure following four consecutive days of gains. Earlier in the week, the pair peaked at 0.7300 but failed to preserve gains as dollar demand reemerged. As a result, AUDUSD slipped back to the 0.7225 area before bouncing slightly in recent trading. It looks like the Australian dollar will keep struggling in the short term while recovery attempts would be limited. As long as the prices stay below the 0.7360 region, downside risks prevail. Of note, during the latest sell-off, the pair dipped back under the descending 20-DMA around 0.7280, adding to a more downbeat technical picture. Furthermore, AUDUSD turned negative on the weekly timeframes, threatening the 200-week SMA again.