EUR/USD: Neutral: Bullish if daily closing above 1.0870/75.

We highlighted yesterday that EUR has to close above 1.0870/75 to indicate that it has moved into a bullish phase. The daily closing of 1.0865 was just below this level and the condition is not met. That said, the current positive undertone is still intact and only a move back below 1.0795 would indicate that a temporary top is still in place. Until then, the risk of sustained rally could not be ruled out just yet.

GBP/USD: Bullish: Next target at 1.2705.

While the ease of which the strong 1.2570 resistance was taken out came as a surprise, the up-move was short-lived (high of 1.2615). We have been bullish since last MondaY  and suggested taking half-profit at 1.2545/50. From here, the outlook for GBP is deemed as bullish until the trailing stop-loss is taken out. Stop-loss on this bullish view is currently at 1.2465, adjusted higher from 1.2430. The revised target is at 1.2705 even though 1.2640 is a strong intervening resistance.

AUD/USD: Neutral: Pull-back has scope to extend to 0.7555.

AUD continues to hold above the short-term 0.7600 support and downward momentum has eased further. However, another leg lower towards 0.7550 cannot be ruled out just yet even though a clear break below this level is not expected. On the upside, a move back above 0.7700 would indicate that a short-term low is in place.

NZD/USD: Neutral: In a 0.6950/0.7090 range. [No change in view]

There is not much to add and we continue to view the current movement as part of a 0.6950/0.7090 consolidation range. While upward momentum is ticking higher, only a clear break above 0.7090 would indicate that a move towards 0.7130, 0.7160 has started. From here, upward momentum would continue to improve unless there is a move back below last Friday’s low near 0.6995.

USD/JPY: Neutral: Bearish if daily closing below 110.00.

Despite the overall negative undertone, USD failed to break below 110.00 (low of 110.09). As highlighted yesterday, USD has to close below 110.00 to indicate that it has moved into a bearish phase. This scenario cannot be ruled out unless USD can move back above 111.50. A shift to a bearish phase would have an immediate target of 108.90.

Source: United Overseas Bank Global Economics & Markets Research

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