EUR/USD: helped by USD weakness

EUR/USD Current price: 1.0932

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After failing to extend its rally, the American dollar got smashed in the New York session, giving back much of the ground gained last week. The day started in slow motion, with no relevant data released in Europe or the US, and in fact, the EUR/USD extended its decline down to 1.0808, a fresh 3-month low. But the lack of follow through finally played against dollar's bulls, forced to take profits out and wait for better levels before getting back in. The catalyst behind the slide was a revision of the US industrial sector, much softer than initially estimated over the past three years, putting a break on hopes the FED can begin tightening as soon as next month. 

The EUR/USD pair advanced up to 1.0968 before finally finding some selling interest. Technically, the 1 hour chart shows that the sharp advance stalled around the pair's 200 SMA, whilst the 20 SMA heads higher below the current level, and that the technical indicators are beginning to turn lower in overbought territory. In the 4 hours chart, the price has advanced strongly above its 20 SMA whilst the Momentum indicator continues to head sharply higher above the 100 level, and the RSI hovers around 59, all of which supports additional advances, should the price extend beyond the 1.0960 region.

Support levels: 1.0920 1.0870 1.0830

Resistance levels: 1.0960 1.1000 1.1045

EUR/JPY Current Price: 135.58

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The EUR/JPY extended its recovery up to 135.75 this Tuesday, helped by the intraday EUR demand. The pair has, however, stalled a few pips its 200 DMA at 136.15, a critical resistance level for the upcoming sessions. Shorter term, the pair is biased higher, as the 1 hour chart shows that the price has extended above its 100 and 200 SMAs, albeit the shortest remains below the largest, which means the rally can be reversed particularly if the price comes back below the 135.00 level. In the same chart, the Momentum indicator heads higher  above the 100 level, whilst the RSI indicator consolidates around 70. In the 4 hours chart, the technical indicators maintain their strong upward momentum after crossing their mid-lines towards the upside, favoring additional advances particularly on a break above the mentioned 136.15 level. 

Support levels:  135.20 134.80 134.40 

Resistance levels: 135.70 136.15 136.60

GBP/USD Current price: 1.5556

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The GBP/USD pair ended the day pretty much unchanged, around 1.5550, although daily basis, the pair has posted a lower high and a lower low, which keeps the risk towards the downside alive. In the fundamental front, the UK public finances continued to improve, as the British government borrowing fell in June to £9.4B, but the data failed to boost the GBP. Short term, the 1 hour chart presents a neutral technical stance, with the price hovering around a mild bearish 20 SMA and the technical indicators lacking directional strength around their mid-lines. In the 4 hours chart however, the downside potential remains intact, as the 20 SMA has declined further above the current price, and now converges with the 23.6% retracement of the latest bullish run around 1.5590, whilst the technical indicators maintain their bearish slopes well into negative territory, supporting a downward continuation towards the 1.5460 level, the 61.8% retracement of the same rally. 

Support levels: 1.5510 1.5460 1.5420

Resistance levels: 1.5590 1.5620 1.5675

USD/JPY Current price: 123.93

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The USD/JPY pair reached a fresh 1-month high of 124.47 earlier in the day, before easing below the 124.00 figure on the back of dollar's weakness and a sharp decline in Wall Street. During the past Asian session, the  Bank of Japan released the Minutes of its latest meeting, showing that several broad members said the impact of the stimulus plans might be fading, but all members agreed that underlying inflation would continue to improve in the long term. In the American evening, BOJ's Governor Haruhiko Kuroda said that he expected inflation in Japan to accelerate considerably in the coming months, adding that inflation is still on track to meet the central bank's 2%  inflation target sometime around the first half of fiscal 2016. The 1 hour chart shows that the price is now below its 100 SMA, whilst the technical indicators have stabilized well below their mid-lines, maintaining the risk towards the downside. In the 4 hours chart, the Momentum indicator is heading slightly lower below the 100 level whilst the RSI hovers around 49, limiting the chances of a sharp recovery during the upcoming hours. 

Support levels: 123.70 123.30 122.90 

Resistance levels: 124.10 124.45 124.90 

AUD/USD Current price: 0.7423

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The AUD/USD pair tripped stops above the 0.7400 level mid American afternoon, advancing to a daily high of 0.7448 before retracing some. Earlier in the day, the RBA reiterated that the Aussie is likely to weaken further, something necessary, according to the Central Bank, "to help achieve a balanced growth in the economy." The Minutes of the latest meeting also stated that another rate cut will be data-dependant, keeping a rate cut in the table for this 2015. During the upcoming hours, Australia will release its  CPI figures for the second quarter of this year, which may help the currency advance further if the numbers surprise to the upside.  Technically, the 1 hour chart shows that the technical indicators are barely retracing from overbought levels, whilst the 20 SMA heads sharply higher below the current price. In the 4 hours chart, the 20 SMA stands horizontal around 0.7390,, whilst the technical indicators have lost their upward strength, but remain above their mid-lines.  The pair needs to extend beyond the mentioned daily high to be able to extend its rally towards the 07500 level, where selling interest is waiting now. 

Support levels:0.7390  0.7360 0.7325 

Resistance levels:  0.7445 0.7470 0.7500