EURUSD ended the day with modest gains but remained close to the lower end of the extended range. Moreover, the pair refreshed three-year lows below 1.0780 on Thursday and struggles to regain the 108 handle. The RSI continues points to oversold conditions, remaining below 30 for ten days already. In another blow for the euro, the 50-SMA has made a bearish cross with the 200-SMA in the daily charts, suggesting the euro will struggle to shake of its weakness in the near term. As such, EURUSD is poised for its third straight week of losses. Should the pair stay below 1.08 and derail the 1.0780 once again, the 1.07 figure may come into focus.
The cable bounced to daily highs around 1.2925 earlier on the day but gains provided short-lived, and the pair was rejected on the way to the 100-DMA and got back below the 1.29 handle. the limited nature of the initial advance confirms sterling’s bearish bias. As such, the GBP has been suffering losses for a fourth day in a row, threatening a local support in the 1.2880 area. Once below this level, the pound may head towards a more significant slide amid a broad-based dollar strength. The daily RSI point to the downside as well.
USDJPY extends the rally after an aggressive spike yesterday. The pair rose to fresh April 2019 highs marginally above 112.00 and retains a bullish tone despite the overbought conditions, with RSI hovering around 76 following an abrupt rise from 55 on Wednesday. On the other hand, the extremely overstretched conditions on the hourly timeframes should be a warning sign for bulls. Moreover, the 112.00 handle could serve as a stiff resistance and cause a correction in the near term. in this scenario, the initial target on the downside arrives at 111.70.
The Aussie dipped to fresh 2009 lows around 0.6620, having accelerated the bearish move following a break below the 0.6660 area. After a timid uptick to the levels just below 0.67, the pair came under fresh downside pressure, adding to weekly losses as the USD index climbed to three-year highs. It remains to be seen if the recent sell-off marks another bearish breakdown, or the pair will attract buyers around 0.66. the oversold conditions suggest the Aussie could try to shrug off the current bearish pressure, at least partially.
Following a nearly ten-day losing streak, the cross spiked higher on Wednesday and keeps the upside bias today, having recouped previous losses. As a result, EURJPY eroded the 121.00 handle for the first time in two weeks and has been attempting to cling to the psychological level. The rally has stalled at the 50-DMA which may serve as a local resistance and cause a bounce after a two-day impressive rally. Should traders proceed to profit taking at fairly attractive levels, the initial downside target will come in the 120.50-120.40, where the 100- and 200-DMAs lie.