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Intraday Analysis – USD claws back losses

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EURUSD seeks support

Chart of EURUSD

The US dollar rallies as Fed officials insist on the need to continue hiking rates. A decisive break above this year’s high of 1.1030 has put the euro back on track after two months of consolidation. A bullish extension may send the single currency to 1.1400 in the upcoming weeks. In the short-term though, a bearish RSI divergence signalled a slowdown in the momentum and a pullback below 1.0980 could trigger a correction with 1.0920 on the 20-day SMA as a backup level. A close above 1.1070 would resume the rally.

XAGUSD hits 12-month high

Chart of XAGUSD

Silver retreats as US Treasury yields and the dollar index bounce off. While sentiment has become extremely bullish after a stellar rise, the RSI’s surge into overbought territory could foreshadow a snapback to give the rally some breathing room. The price came under pressure at its 12-month high and the psychological level of 26.00. A drop below 25.40 suggests a lack of immediate follow-through, leading to a potential correction. Then 24.60 at the confluence of the January high and the 20-day SMA would be a key floor.

UK 100 tests key supply area

Chart of UK100

The FTSE 100 climbs boosted by the optimism in the broader bank sector. On the daily chart, after hitting bottom at 7200, the V-shaped rebound is lifting the index back towards its previous peak at 8030. The price is entering an important supply zone around 7900 from a previous sell-off in March. A bullish outcome would expose the aforementioned peak, potentially leading to a bullish continuation in the medium-term. On the downside, 7830 is the first support while 7750 would be the bulls’ second line of defence.

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