EUR/USD: Neutral: Immediate downward pressure towards 1.0595.
EUR edged below last Friday’s low to touch 1.0641 before rebounding weakly to close higher for the first time in 4 days. As indicated yesterday, the immediate pressure is still on the downside towards the major 1.0595 support even though oversold short-term conditions suggest that this level is unlikely to come into the picture so soon. On the upside, EUR has to reclaim 1.0740 to indicate that the immediate downward pressure has eased.
GBP/USD: Neutral: Bullish if daily closing above 1.2615.
The pull-back yesterday appears to be corrective and as long as 1.2435 is intact, the undertone for GBP is still positive. That said, it is early days yet and GBP has to close above last week’s 1.2615 high to indicate that a bullish phase has started. A move below 1.2435 would suggest this pair has moved into consolidation phase.
AUD/USD: Neutral: A retest of 0.7585/90 seems likely.
As indicated yesterday, the immediate bias is for AUD to retest last week’s low near 0.7585/90. The low at the time of writing is 0.7589 and with no signs of stabilization just yet, a clear break below 0.7585/90 could lead to a rapid drop towards the March’s low of 0.7490 (with strong ‘intervening’ support at 0.7550). Only a move back above 0.7660 would indicate that the immediate downward bias has eased.
NZD/USD: Neutral: In a 0.6950/0.7090 range. [No change in view]
NZD has been trading choppily in recent days but essentially held within the expected 0.6950/0.7090 consolidation range. Indicators are showing mixed signals and at this stage, there is no pre-indication that a break out of the range is imminent.
USD/JPY: Neutral: In a 110.00/112.20 range.
While we continue to hold the view that USD is trading in a 110.00/112.20 consolidation range, the rapid decline yesterday suggests increasing downward pressure. In other words, it is more likely that we would see a move to 110.00 first. The downward pressure would continue to increase unless there is a move back above 111.50.