Should 1.2700 give up anytime soon, the pound will target the 1.2675 intermediate support
The safe-haven dollar rallied across the market amid massive risk aversion on Monday that pushed the greenback to fresh long term tops around 101.75 earlier in the day. The price has retreated to the 101.50 zone since then, staying resilient in early European trading hours. After the initial bullish gap at the open in reaction to Emmanuel Macron’s victory, EURUSD plunged to March 2020 lows just above the 1.0700 figure earlier in the day. The pair managed to trim some losses since then to bounce towards 1.0740 in recent trading as the overbought USD came off peaks. However, the recovery potential looks limited for the time being, with downside risks persisting in the immediate term while below at least the descending 20-DMA, currently at 1.0893. In turn, the outlook for the dollar remains constructive for the time being despite the overbought conditions.
GBPUSD plunged dramatically ahead of the weekend after another failed attempt to regain the 20-DMA. The sell-off continued at the start of the week to push the pair September 2020 lows around 1.2730. The cable was last seen changing hands around the lower end of the extended trading range, threatening the 1.2700 immediate support during the European hours. In the process, the daily RSI has entered the oversold territory for the first time since mid-March and continues to point south, suggesting there is still room for deeper losses in the near term. Should 1.2700 give up anytime soon, the pound will target the 1.2675 intermediate support that could cap the pressure. Otherwise, GBPUSD may threaten 1.2400. On the four-hour charts, the technical picture suggests the cable could see fresh lows before making a local reversal amid oversold conditions.
USDJPY is trading marginally lower on Monday, lacking the upside momentum to get back to twenty-year highs seen around 129.40 last week. The pair has settled just above 128.00 since then, struggling for direction these days as the rally has faded somehow while the bearish correction looks limited as well. The dollar was last seen changing hands at 128.15, down 0.31% on the day. On the hourly charts, the technical picture looks neutral for the time being, suggesting USDJPY could struggle to get back above 129.00 in the near term. However, it looks like the greenback will stay afloat anyway, especially as the pair refrains from a pronounced retreat despite the extremely overbought conditions. On the downside, the immediate support now arrives at 128.00, followed by the 127.60 zone and the 127.00 figure.
Bitcoin fell back to mid-March lows, being under pressure along with traditional risky assets. The BTC price extended losses to the $38,100 area and was last seen changing hands just marginally above fresh local lows, staying under pressure during the early European trading hours. In the near term, the coin needs to regain the $40,000 mark in order to refrain from a steeper sell-off. However, it looks like the path of least resistance is to the downside for the time being. The immediate support now arrives at $37,500, followed by the $37,100 zone. Should the coin fail to hold above the latter, February lows around $34,300 will come back into the market focus. In a wider picture, the BTCUSD pair needs to settle above $43,000 in order to shrug off some of the weakness. However, it looks like the path of least resistance for the cryptocurrency remains to the downside at this stage.