USDJPY came under pressure amid broad-based profit-taking surrounding the US currency
The dollar stays pressured after yesterday’s retreat, struggling to regain the 109.00 mark that now represents the immediate upside target for the USD index. The index has eased from twenty-year peaks to settle back below the 109.00 mark after dropping back from the 109.50 zone not seen since September 2002. Now, the greenback is in search of fresh clues ahead of Friday’s NFP data.
As such, EURUSD has steadied around parity, trading in positive territory since Monday. EURUSD keeps clinging to the lower end of the trading range, albeit refraining from a deeper retreat towards fresh long-term lows. In the near term, the euro may regain parity but any sustained recovery is unlikely at this stage. On the downside, a failure to hold above 0.9900 would bring the pair to fresh multi-year lows, with downside risks persisting while below at least the 200-week SMA, today at 1.1340.
GBPUSD shrugged off the selling pressure on Tuesday amid dollar’s broad-based retreat. The pair extended the decline at the start of the week, falling to the 1.1650 zone for the first time since March 2020. The pound was last seen changing hands around 1.1740, up 0.29% on the day. As such, the bearish potential has eased at this stage, albeit downside risks continue to persist, especially as the pair holds well below the descending 20-DMA, today at 1.1970. On the four-hour charts, the bearish momentum has eased somehow as the RSI has recovered from oversold territory, suggesting the selling momentum could slow down at this stage. On the longer-term timeframes, the technical picture stays negative, with the prices holding below the key weekly SMAs while the RSI keeps pointing lower despite the oversold conditions.
USDJPY rallied on Monday to mid-July highs around 139.00 to close with solid gains. However, the greenback failed to extend the ascent, trading under pressure today amid broad-based profit-taking surrounding the US currency. Still, the pair is holding well above the 20-DMA, today at 135.57 while also clinging to the upper end of the extended trading range. Following the initial rally, the dollar retreated back below 139.00 and was last seen trading around 138.30, down 0.28% on the day. In the near term, USDJPY needs to hold above the 138.00 mark for the overall bullish momentum to persist. A decisive recovery above the 139.00 mark would bring long-term tops around 139.40 back into the market focus. In case of a deeper downside correction, the nearest support should be expected around 138.00, followed by the 137.60 figure.
The Aussie keeps trending north for the second session in a row on Tuesday, approaching the 20-DMA, currently at 0.6964. The pair extended gains to 0.6950 and was last seen changing hands at the upper end of the range, holding onto solid gains, which implies that AUDUSD could at least retain bullish tone in the immediate term. On the downside, the nearest support now arrives at 0.6930, followed by 0.6900 and the 0.6875 intermediate support on the way towards mid-July lows that capped yesterday’s losses around 0.6940. In a wider picture, however, the pair remains vulnerable to fresh losses after a short-term bounce, especially as the prices stay below the key daily simple moving averages. AUDUSD needs to make a decisive break above the 0.7000 mark that represents the immediate key target for the Aussie bulls.