EURUSD: a further participation of bears can be expected below 1.25 levels

EUR/USD - Hourly chart

The EUR/USD pair finished yesterday above 1.26 levels after recovering from an intraday low of 1.2547. However, the pair declined today to trade at 1.2564 with the daily RSI bearish at 38.25 levels. As expected, the prices declined after the pair re-tested and faced rejection at the hourly chart Head and Shoulder Neckline level located around 1.2620 levels. The hourly RSI, at 26.00, has once again hit the overbought zone, although it can extend the fall to 20.00 levels, seen yesterday. The pair is likely to re-test the 1.2547 levels, and may extend the decline to 1.25 levels today. Moreover, we could see a bullish Price-RSI divergence develop today on the hourly chart, if the pair manages to rise after hitting lows below 1.2547 levels, while the hourly RSI sustains above 20.00 levels. In such a case, a fresh demand for the Euros can be anticipated above 1.2580 levels, which could lead to a re-test of 1.2670 levels. Meanwhile, a further participation of bears can be expected below 1.25 levels.

GBP/USD - Hourly chart

The GBP/USD pair finished yesterday at 1.6001 levels, after having recovered from an intraday low of 1.5951. The pair has resumed its southward journey, trading at 1.5970, after having struggled to rise above 1.61 levels earlier today. Moreover, the pair has failed to sustain gains above the hourly chart double top formation neckline located at 1.5995. The hourly RSI, at 1.5969, indicates a high probability that the pair would breach 1.5951 levels and may test 1.59 levels today. The daily RSI too, is bearish at 38.936 levels. The bears are likely to stay in control of the pair so long as it trades below the 1.6070 levels.

EUR/GBP - Hourly chart

The EUR/GBP pair finished yesterday at 0.7883, after facing rejection at the 50-day moving average level of 0.7906. The prices are trading lower at 0.7872 levels, after struggling to rise above the 5-day moving average level of 0.7883. Moreover, the prices continue to trade in a 40-pip range of 0.7860-0.79. However, the odds are higher of a downside breakout from the range, since the daily and the hourly RSI are bearish, hovering below 50.00 levels. The bears are likely to come-in strong below 0.7860 levels, under which the pair can extend losses to 0.7920 levels. On the other hand, a fresh demand for the Euros can be anticipated once the pair ends the day above the 50-day moving average level located at 0.7906.

USD/JPY – Daily Chart

The USD/JPY pair shot higher today after the Bank of Japan surprised markets by announcing an increase in the stimulus program. The pair is trading at 111.15 levels, as it breached multiple resistance levels of 110.10 and 110.67 on its way up. The daily RSI, at 72.00, has entered the overbought zone, although the momentum in the prices is strong enough to take the RSI even higher. Meanwhile, the hourly RSI has hit 90.00 levels, indicating a possibility of correction in the pair. However, the pair is more likely to test the immediate resistance located at 111.57 levels today. We could see a bearish price-RSI divergence develop on the hourly chart if the prices decline after rising to further highs while the RSI stays below 90.00 levels. In such a case, a correction could push the pair down to 110.10 levels. On the other hand, further bull strength can be expected above 111.57 levels.