USDJPY bounces higher
The Japanese yen fell after the BoJ kept its policy unchanged and lowered its inflation forecast for the year. A surge above May’s high of 140.90 saw the dollar breaking above the recent consolidation range and would signal a bullish continuation towards 145.00. Last November’s swing high of 142.00 is the closest hurdle as the RSI’s double top in the overbought area may temper the bullish fever with a limited pullback. 140.90 is a fresh support and 139.90 over the 20-day SMA a major level in maintaining the bullish bias.
EURGBP struggles to bounce
The pound advances as traders expect a higher terminal rate from the BoE. On the daily chart, the pair is still licking its wounds after falling below the critical floor of 0.8570 from last December. A rebound came to a halt at 0.8610 and suggests that the bears would sell into strength as sentiment remains downbeat. Only a break above this resistance would open the door to a meaningful recovery. Until then, 0.8500 is the next level to see if the buy side would step in and they will need to clear 0.8560 before the euro could stabilise.
GER 40 grinds higher
The Dax 40 edged higher as inflation decelerated in May across the Eurozone. The rally gained traction after it closed above the recent peak and the all-time high of 16330. This is a strong indication of the underlying bullish mood. A brief pullback was met with follow-up buying at 16180, which showed traders’ commitment in keeping the direction up. 16500 is the next obstacle to lift when momentum returns. On the downside, a drop below 16180 would send the index to the psychological level of 16000 next to the 30-day SMA.
