EUR/JPY and EUR/GBP led the way higher for the EUR crosses as the lack of any more bad news out of the EZ encouraged traders to cut their short positions. The massive rush to sell the Yen showed no sign of abating, with NZD/JPY leading the way higher for the JPY crosses.
There are quite a few risk events on today’s economic calendar with Ben Bernanke scheduled to make a speech, wand Chinese CPI and BOJ meeting minutes also likely to add to volatility.
USD/JPY continues on its inexorable march towards 100.00. There are likely to be barriers at this level which may slow things down but the next technical resistance of note is a weekly high at 101.40. Support levels are not close by, not really starting until 97.50, so do be wary of excessive volatility.
EUR/JPY is also powering towards a big psychological level at 130.00 and there is little technical resistance there either until we reach the mid 130’s. Initial support is now at previous highs near 128.00.
The EUR made solid gains on other crosses like EUR/GBP for instance, but most of these gains came through a weaker cable leg. EUR/USD has steadied around 1.3000 but traders report stops building above 1.3050, so the immediate danger is most likely to the topside.
Cable should find some support near the previous resistance level at 1.5250 but the overall bear trend is still in control so I prefer the sell-rally play. EUR/GBP support levels start at .8500 and the next topside target is at .8560.
EUR/CHF is also trying to form a base above 1.2130 but needs to regain a foothold above 1.2200 before the bulls can start feeling a bit more confident.
The NZD was in demand again overnight and its TWI has reached new post-float highs. NZD/JPY made another sharp move higher overnight and highs from 2008 at 83.10 were breached.
The AUD is unable to maintain momentum in either direction, and the possible double-top formation on the short term charts has been negated by the close back above 1.0400. Range trading is still dominating the AUD/USD whilst the runaway bullish AUD/JPY trend is now targeting 104.50 weekly highs.
Good luck today.
Recommended Content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.