Mid-Week Technical Outlook: FX Majors In Focus

It was another volatile day for financial markets as geopolitical developments influenced global risk sentiment.

Stocks rallied, the dollar softened and oil prices weakened on the prospects of peace talks between Russia and Ukraine. There was plenty of action in the FX space as major currency pairs reacted to a weakening dollar, while gold and other safe-haven assets struggled to shine amid the improving market mood. Later this evening, the Federal Reserve is widely expected to raise interest rates for the first time since 2018 which could lend some support to the greenback.

Today, our focus will be on G10 currencies. As you have already figured out, our tool of choice is technical analysis.

EURUSD experiencing a pullback?

The EURUSD remains in a downtrend on the daily charts. There have been consistently lower lows and lower highs while the MACD trades below zero. Price action suggests that the currency could be experiencing a minor pullback before bears target 1.0850 and lower. A breakout above 1.1121 could signal an incline towards 1.1320.

GBPUSD remains bearish on weekly

Pound bears remain in control on the weekly charts with prices respecting a bearish channel. The currency could experience a technical rebound from the 1.3000 support level before resuming the current downtrend. Bulls also need to overcome the 200-week Simple Moving Average which can be found around 1.3120. Fundamental factors in the form of the Fed & BoE policy meeting could play a role in where the currency pair concludes this week. Should 1.3000 prove to be unreliable support, a decline back towards 1.2750 could be on the cards.

USDJPY hits fresh 5-year highs

A weaker Yen propelled the USDJPYto a fresh 5 year high today with prices approaching the 119.00 level. Prices a heavily bullish on the daily charts with the path of least resistance pointing north. A solid break above 119.00 could inspire a move towards levels not seen since February 2016 around 121.00. If the upside momentum runs of out steam, prices may decline back towards 117.40.

USDCHF bulls in the building

A chart can say 1000 words. Taking a look at the USDCHF, bulls are clearly in control and are eyeing 0.9470. Beyond this level, key points of interest can be found at 0.9500 and 0.9620. Should 0.9470 prove to be reliable resistance, prices could slip back towards 0.9370 and 0.9300.

GBP. USD EUR AUD JPY SMA FED MACD