Forex Trading Library

Intraday Analysis – JPY turns lower

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USDJPY tests key ceiling

The Japanese yen plunged as hopes of a policy change faded after Governor Ueda’s dovish BoJ debut. A solid break above 135.10 which has held the dollar back for six weeks shows renewed interest in putting the pair back on track. 137.00 at the start of the March pullback is a major ceiling and its breach would take out the remaining bears and signal a bullish continuation in the medium-term. An overbought RSI may briefly temper the upward thrust and let the bulls catch their breath, 134.50 would be a fresh support in this case.

EURGBP breaks lower

The pound surged as UK business confidence reached a near one-year high in April. Three consecutive tests of 0.8870 at the origin of a sell-off back in March have failed to lift offers in this key supply zone, suggesting that the path of least resistance would be down. The confirmation came in as the pair broke the previous swing low of 0.8790, denting the upward bias in the short-term and exposing April’s lows around 0.8740. With the RSI in the oversold area, 0.8800 is the first resistance to clear in case of a bounce.

US 30 resumes uptrend

The Dow Jones 30 climbs supported by better-than-expected corporate earnings. The index has found solid buying interest over the 30-day SMA (33250). A quick bounce above 33850 has forced short-term sellers to cover, turning the area near 33650 into a fresh demand zone. A close above the recent top of 34130 would clear the path for a sustained recovery towards December’s spike at 34890, with the possibility of further extension in the near future. The RSI’s double top in the overbought zone may cause a limited retreat.

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