Forex Trading Library

Intraday Market Analysis – USD Keeps High Ground

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USDJPY consolidates gains

The Japanese yen clawed back losses after BoJ boss Kuroda raised concerns about the yen’s sharp decline. The pair has been climbing along a rising trend line. The lack of supply zone means that there is little resistance on the upside. The RSI’s overbought situation on the daily chart has caused a pullback and a fall below the trend line indicates that the greenback could use some breathing room. 133.50 is the first level to gauge the strength of the bullish momentum. A bounce above 135.00 would carry the price to 137.00.

EURGBP tests major resistance

Sterling weakened after Britain’s GDP showed a larger-than-expected contraction in April. A rising pennant on the daily suggests that a breakout may soon put an end to the month-long consolidation. 0.8615 is a major supply area after several failed attempts. Its breach would flush out the remaining selling interest and signal a bullish continuation towards April’s highs near 0.8700. 0.8530 is the immediate support in case of further hesitation. 0.8485 is a critical floor to keep the upward bias intact.

US 30 breaks critical support

The Dow Jones plunges over a broad-based rise in risk aversion. The liquidation continued after the price action failed to hold above 32600. Sentiment remains overwhelmingly downbeat. A fall below the major support at 30700 may officially make the recent rally a dead cat bounce and send the index into bearish territory. The psychological level of 30000 would be the next support. An oversold RSI may trigger a temporary bounce but the bears could be expected to sell into strength near 31700.

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