EUR/USD (1.132): EUR/USD continues to trade within the head and shoulders pattern that was formed. Last week prices bounced off the neckline support to retest the resistance level near 1.1373 – 1.1320 region. As long as this resistance level holds, EUR/USD could remain biased to the downside, this time possibly breaking below the rising neckline support.
Following this breakdown lower, prices could test lower support at 1.105 – 1.10285 region. Alternatively, a break above 1.1373 resistance could possibly weaken the head and shoulders pattern and could see the sentiment shift to the upside, for a test to 1.150 – 1.14890.
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EUR/USD: Head and shoulders pattern in play
USD/JPY (104.06):Â USD/JPY remains biased to the downside, although there are signs of slowing momentum. But prices, having clear below 105.6 remains poised to see more downside in the near term. The next main support comes in at 103 level, and an eventual correction down to 102 region. The resistance at 105.7 – 106.20 remains key for any upside to be validated. There is also a risk of USD/JPY sliding to the 100 level round number psychological barrier in the near term, but more downside below 100 is unlikely.
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USD/JPY: Watch for a possible test of 100 support
GBP/USD (1.466): Despite the volatility, GBP/USD has been respecting the technical levels so far. Afte last week’s reversal near the 1.405 – 1.40 support, prices have pushed higher, breaking above 1.441 – 1.436 resistance level to test the previous highs formed near 1.466 – 1.47- region. Any downside is limited to retesting the broken resistance level at 1.441 – 1.4364 for support, keeping GBP/USD potentially biased for a move to 1.4934 is the retest of support holds.
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GBP/USD: Correction to 1.441 – 1.4364 likely
USD/CAD (1.278): USD/CAD posted a correction to 1.30 resistance, but price action clearly fell back. The cup and handle pattern mentioned a few weeks ago is starting to get weaker with prices sliding back to support at 1.2750. In the near term, USD/CAD could remain trading sideways above 1.26 and below 1.30. Further upside is expected only on a break above 1.308 – 1.313 resistance, while to the downside, support at 1.26 – 1.2525 remains key.
