Currency Analysis Summary
In a recent analysis by Greg Michalowski, the focus is on the current state of three major currency pairs: EURUSD, GBPUSD, and USDJPY, as the North American trading session begins. The U.S. dollar exhibits mixed performance, with USDJPY experiencing a notable surge due to comments from Japanese officials, while EURUSD and GBPUSD remain relatively stable within narrow trading ranges.
USDJPY Analysis
The USDJPY pair has seen a significant increase, attributed to remarks from Japan's Prime Minister Takaichi, who expressed concerns to Bank of Japan Governor Ueda regarding further interest rate hikes. This sentiment has weakened the yen, leading to a rally from strong technical support levels.
The pair rebounded decisively from its 100-day moving average at 154.99, gaining momentum and surpassing the 61.8% retracement level of the February high-to-low decline at 155.592, which has now become a near-term support level. As long as the price remains above this retracement, buyers are expected to maintain control, although a drop below could indicate a potential correction.
EURUSD Analysis
The EURUSD pair is currently subdued, trading within a tight 28-pip range, which is approximately 37% of its average daily range over the past month. The technical outlook appears bearish, as sellers are actively pushing against the falling 100-hour moving average at 1.17877. A sustained position below this moving average keeps the pressure on the downside.
A break below the 1.1765 swing low could lead to further declines, targeting last week’s double bottom at 1.17414, and potentially the 100-day moving average at 1.16888, although this would likely require stronger downward momentum.
GBPUSD Analysis
Similar to EURUSD, the GBPUSD pair is also range-bound, trading within a 36-pip range, about 39% of its typical daily range. The pair briefly exceeded its 100-hour moving average at 1.34915 but faced resistance at the February 6 swing low of 1.35078, which now acts as a ceiling. The subsequent drop back below the 100-hour moving average has shifted the short-term bias to the downside.
Key support levels to watch include today’s low at 1.34708 and the 200-day moving average at 1.34435. A sustained move below the 200-day MA could strengthen bearish sentiment and open the path toward the 100-day moving average at 1.33915.
Key Technical Levels
USDJPY
- Resistance: 155.592 (61.8% retracement)
- Support: 155.592 (now support), 154.99 (100-day MA)
- Bias: Short-term bullish above 155.59
EURUSD
- Resistance: 1.17877 (100-hour MA)
- Support: 1.1765, 1.17414, 1.17265, 1.1700
- Broader Target: 1.16888 (100-day MA)
- Bias: Bearish below 1.17877
GBPUSD
- Resistance: 1.34915 (100-hour MA), 1.35078 (ceiling)
- Support: 1.34708, 1.34435 (200-day MA)
- Broader Target: 1.33915 (100-day MA)
- Bias: Bearish below 1.34915
This analysis highlights the current technical landscape of these currency pairs, indicating potential trading strategies based on key support and resistance levels.