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Intraday Analysis – USD to bounce higher

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USDCHF tests important ceiling

The Swiss franc tumbled after the Swiss National Bank unexpectedly paused its interest rate hikes. A jump above the psychological level and July’s high of 0.9000 has sent a strong signal that the buy side was back in the game. Last May’s peak of 0.9130 might be the bears’ last line of defence from the medium-term perspective. As the RSI falls back into the neutrality area, 0.8990 will be the first level to expect follow-up interests, with 0.8930 which sits near the 20-day SMA as a backup in case of a prolonged consolidation.

GBPUSD struggles for bids

Cable slipped after the BoE left its interest rates unchanged. On the daily chart, a drop below May’s bottom of 1.2320 further put buyers on the defensive, making Sterling vulnerable to a bearish reversal. 1.2220 at a 6-month low is the next level to see if buying interests would make their way back. On the upside, 1.2420 from a previously faded rebound is the first hurdle to clear and then 1.2500 at the confluence of former support and the 20-day SMA is a major cap to lift before a meaningful rebound could take shape.

USDJPY seeks support

The Japanese yen weakened as the BoJ held its benchmark policy rate at -0.1%. The dollar’s fall below the previous consolidation of 147.50 has dented the momentum from the bullish breakout last week, taking out some weak hands. However, sentiment remains widely optimistic as the greenback is still on its way to last November’s high of 148.80, right under the psychological tag of 150.00. On the downside, 147.00 on the 20-day SMA is the closest support, and 146.00 is an important level to prevent a deeper correction.

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