USDJPY Update: Will the Downtrend Continue?

The USDJPY pair has been making some interesting moves on the 4-hour chart. After breaking out of the falling price channel, it seemed like the pair was ready to turn things around. However, it quickly hit resistance at 155.21 and dropped back down to 152.41.

This move suggests that the pair is still stuck in a downtrend, which started at 151.95. So, what's next? We're likely to see the pair test the 151.93 support level later today. If it breaks below this level, get ready for a further decline to 150.90, and possibly even 150.00.

But, if the pair can break above the key resistance level at 155.21, it could be a sign that the downside move from 161.95 has finally come to an end. In this case, we could see the pair make a move towards 155.80, followed by the 158.00 area.

Keep an eye on these levels and see how the USDJPY pair plays out!

ForexInflux

EURUSD Analysis: Key Levels to Watch

 The EURUSD currency pair recently failed to break above the 1.0870 resistance level and has since dropped below 1.0825. This downward move extended from 1.0948 to as low as 1.0802.

Current Position and Potential Rebound

The pair has now reached the bottom of a falling price channel on the 4-hour chart. This suggests that a rebound could be on the horizon in the coming days, with the first target being the top of the channel.

Downside Potential

Despite the potential for a rebound, if the channel resistance holds, the downside move is likely to resume. In this case, we could see further declines, with the next target around 1.0770, and possibly down to the 1.0725 area.

Upside Potential

On the upside, if EURUSD breaks through the channel resistance, the price could move up to the next resistance level at 1.0870. A move above this level would indicate that the recent downside move has ended, potentially leading to another rise towards the 1.0948 resistance.

Stay tuned for more updates and keep an eye on these key levels!

ForexInflux

USD/JPY Shows Signs of Rebound Amidst Price Channel Dynamics

 USD/JPY has shown signs of a rebound from 151.93, supported by the lower boundary of the descending price channel on the 4-hour chart. This indicates a period of consolidation for the downward trend from 161.95 is currently in progress.

In the days ahead, there is a possibility of a further rally with the next target set at the upper boundary of the channel. However, the continuation of the downtrend is likely if the channel resistance remains unbroken.

Presently, the initial support level stands at 153.05. A breach below this level could prompt a retest of the 151.93 support, followed by a potential decline towards the 150.90 mark, and eventually targeting the 150.00 area.

On the upside, a breakout above the channel resistance could propel the price towards the next resistance level at 155.80. Surpassing this level may indicate the end of the downtrend.

Traders should closely monitor the price action to discern potential opportunities as the currency pair navigates within the confines of the price channel.

ForexInflux

USD/JPY Update – Yen Gains Ground Amid Dollar Weakness

Recent daily charts for the USD/JPY currency pair show that the yen has made significant progress, aided by a weakening dollar and what appears to be intervention by Japanese currency officials. The market was caught off guard by actions taken by Japanese authorities.

Following news of U.S. inflation coming in lower than expected, Japan seems to have initiated large-scale purchases of the yen. This marks a stark contrast to previous interventions, which typically occurred in response to negative news, such as U.S. inflation or economic growth exceeding expectations.

The daily chart indicates that a short-term bearish reversal has materialized. Since then, the USD/JPY pair has been on a downward trajectory, breaking through critical support levels at 160.00 and 155.00 along the way.

Looking ahead, if inflation unexpectedly declines, this week’s U.S. Personal Consumption Expenditures (PCE) data could further extend this trend. However, if the data meets expectations, the trend may continue at a slower pace. The next support levels to watch are at 151.90 and 150.

In summary, the yen’s recent gains against the dollar highlight the impact of economic data and potential intervention strategies. Keep an eye on upcoming economic releases as they could significantly influence the USD/JPY pair’s direction!

Written by: ForexInflux.com

EURUSD Analysis: Potential Breakdown Below Support

 The EURUSD pair has recently broken below the rising price channel on the 4-hour chart, signaling a potential shift in momentum. Currently, the pair is testing the key support level at 1.0871.

If the pair breaks below the 1.0871 support, it would indicate that the previous upside movement from 1.0665 to 1.0948 has likely completed. In this scenario, the next downside targets would be at 1.0830, followed by the 1.0800 area.

However, it's important to note that as long as the 1.0800 support level holds, there is still potential for the upside move from 1.0665 to resume. This could lead to another rise towards the 1.1000 level.

In terms of resistance, the initial barrier is at 1.0910. A break above this level could trigger another upward movement to test the previous high at 1.0948. If the pair manages to surpass this level, it would then aim for the 1.1000 mark.

In conclusion, the EURUSD pair is currently at a critical juncture, with the potential for a breakdown below support or a resumption of the upside move. Traders should closely monitor the price action around the key levels mentioned to gauge the future direction of the pair.

by ForexInflux

GBPUSD Analysis: Potential Range Trading and Key Levels to Watch

 In the recent market movement, GBPUSD has broken below the significant support level at 1.2938, indicating that the upward movement from 1.2612 may have reached its peak at 1.3044.

As a result, it is likely that we will see range trading between 1.2800 and 1.3044 in the coming days. This means that the currency pair is expected to fluctuate within this range without a clear trend in either direction.

However, it's important to note that as long as the support at 1.2800 holds, there is potential for the upward movement from 1.2612 to continue. In this scenario, a breakout above the resistance level at 1.2950 could signal another rise towards the previous high at 1.3044. If this level is surpassed, the next target would be the 1.3150 area.

On the downside, initial support is seen at 1.2890. If the price falls below this level, the next support levels to watch are at 1.2830 and then 1.2800.

In conclusion, GBPUSD is currently in a potential range trading phase, with key levels to watch at 1.2800, 1.2950, and 1.3044. Traders should monitor these levels closely to assess the potential direction of the currency pair in the coming days.

By ForexInflux

Interest Rate and Economic Growth Driving Forces for the Pound

 Interest rate differentials are a key fundamental driver of currency movements, currently favoring the British pound. The real interest rate in the UK stands at 3.25%, higher than the United States' rate of 2.5%. The rising real interest rate in the UK compared to the US is strengthening the pound against the dollar, and this trend may continue to grow.

The possibility of a Fed rate cut in September stands at 90%, with markets predicting multiple rate cuts by the end of the year. In contrast, the likelihood of a rate cut by the Bank of England in August is only 57%, with expectations of less than two rate cuts this year.

Recent weeks have seen improved economic growth prospects in the UK. After a flat GDP growth in April, the growth rate in May was 0.4%, exceeding the expected 0.2% growth. Growth in construction output and a slight uptick in the services sector index have driven the GDP growth, with the services sector index increasing by 1.1% over a three-month period. This could lead to the Bank of England raising its economic growth forecast at the next meeting in August.

It is also possible that inflation forecasts in the UK will be revised upwards. While CPI is expected to be 2% this year and 2.6% next year, an increase in April's living wage may lead to higher core inflation later this year. The new Labour government may look to extend the living wage further, possibly announcing plans in the autumn budget.

The Bank of England has plenty of reason to hold off on a rate cut until after the new government's first budget, which could benefit the pound, especially considering that higher interest rates have not hindered the UK's continued recovery from last year's recession.

If the pound breaks through 1.30 against the dollar in the coming days, it could potentially rise to 1.40, reaching its highest level since 2021.

 by ForexInflux

Australian Dollar Faces Volatility Amid Diverging Central Bank Expectations

On Monday, July 8th, the Australian dollar fell by 0.18% against the US dollar, closing at 0.6737. This slight dip came after reaching a six-month high of 0.6761 during Asian trading on Friday, and was influenced by profit-taking. Additionally, the Australian dollar was dragged down by a decline in commodity prices on Monday. However, the downside potential for the Australian dollar is limited due to diverging interest rate expectations between the Reserve Bank of Australia (RBA) and the Federal Reserve.

Market expectations suggest a 27% probability of a rate hike by the RBA in August, while the probability of a rate cut by the Federal Reserve in September stands at 80%. The upcoming testimony of Federal Reserve Chairman Jerome Powell before Congress on Tuesday and Wednesday, as well as the US Consumer Price Index (CPI) data on Thursday, will be crucial events this week. If these events indicate a likely rate cut by the Federal Reserve in September, it could stimulate further upward movement for the Australian dollar.

Looking at the daily chart, if the AUD/USD pair closes above the 76.4% Fibonacci retracement level of the decline from 0.6870 to 0.6361 (which is at 0.6750), it could signal a bullish trend with a potential target of 0.6870. Resistance levels are seen at 0.6770, 0.6800, and 0.6840, while support levels are at 0.6700-10 and 0.6675-80.

In conclusion, the Australian dollar is facing volatility amid contrasting monetary policy expectations between the RBA and the Federal Reserve. Traders and investors will closely monitor upcoming events to gauge the potential impact on the currency's movement in the near term.

ForexInflux

USD/JPY in Consolidation Phase as it Retreats from High

 The USD/JPY pair is currently experiencing a pullback from its recent peak of 161.95. This retreat has resulted in a break below the bottom of the rising price channel on the 4-hour chart, indicating that a consolidation phase is now underway for the uptrend originating from the low point of 151.86 on May 3.

Support and resistance levels

As the pair continues its consolidation, it is currently encountering a support level at 160.26. Should the price break below this level, it may trigger a further downside movement towards the 158.00 area.

On the other hand, the initial resistance is situated at 161.40. If the price manages to break above this level, it could signal a resumption of the uptrend. The next target levels to watch for would be the previous high at 161.95, followed by the 163.00 area.

In summary, the USD/JPY pair is currently in a consolidation phase after pulling back from its recent high. Traders should keep an eye on the support level at 160.26 for signs of further downside movement or watch for a breakout above the resistance level at 161.40 for a potential continuation of the uptrend.

 by ForexInflux