Market Outlook: Euro Holds Positive Near-Term Outlook

EUR/USD

The euro holds positive near-term tone off 1.3585 low, as Friday’s acceleration higher peaked at 1.3649, 76.4% of 1.3667/1.3585 downleg and subsequent pullback being contained by hourly 55SMA at 1.3619, just above 50% of 1.3585/ 1.3649 rally, keeping hourly bulls intact for now. Positive studies on hourly and indicators attempting above the midlines on 4-hour chart, support fresh strength that attempts to clear already cracked 200SMA at 1.3640 and further upside requires clearance of initial 1.3667, 27 May lower top, to signal recovery extension towards the next breakpoints at 1.3733/40, mid-May lower platform / Fibonacci 38.2% retracement of 1.3992/1.3585 fall, to confirm near-term base and open way for stronger recovery. Formation of Morning Star reversal pattern on a daily chart, supports the notion. Conversely, failure under 1.3733, would keep risk of lower top formation and fresh push lower in play, as larger picture bears are still in play and strong 1.3733/40 resistance being reinforced by 20/100SMA bear-cross.

Resistance: 1.3649; 1.3667; 1.3687; 1.3733

Support: 1.3619; 1.3600; 1.3585; 1.3561




EUR/JPY

The pair trades in near-term range-trading mode, with price being contained between 138.00/139.34 span. Failure to break below 138.00 handle, after completing initial 138.00/139.34 correction, produced fresh bounce, with the price action stalling at 139 barrier on overextended hourly studies. However, positive tone, developing on 4-hour studies, underpins current bounce and formation daily Morning Doji Star reversal pattern, keeps the upside favored. Clearance of 139.34 range top is required to confirm recovery phase beginning and signal double-bottom pattern formation, for fresh attempt at strong 140.00 barrier. Otherwise, extended range trading would be likely, with the downside to remain vulnerable while 139.34 remains intact.

Resistance: 139.34; 139.74; 140.00; 140.24

Support: 138.00; 137.52; 137.00; 136.74



GBP/USD

The Cable remains under pressure, with near-term price action being in corrective mode after denting psychological 1.67 support. The recovery is so far limited, as the price remains capped by 38.2% retracement at 1.6777, with break here and psychological 1.6800 hurdle, required to open stronger recovery. Key near-term barrier and the first pivot lies at 1.6860, bear-trendline off 1.6995 peak and break here is required to confirm reversal, signaled by Morning Star pattern formation on a daily chart. Otherwise, extension of larger bears off 1.6995 would remain in play, as larger picture remains bearish. Slide below fresh low at 1.6691 is required to confirm scenario.

Resistance: 1.6776; 1.6800; 1.6835; 1.6860

Support: 1.6736; 1.6703; 1.6691; 1.6667



USD/JPY

The pair continues to consolidate under fresh high at 102.13, with the downside being so far contained by 101.41, near 50% retracement of 100.81/102.13 ascend. Near –term studies are positive, as the price trades near the upper barriers, with break above 102.13, required to signal resumption of recovery rally off 100.81 and open next pivot at 102.35, 13 May peak / near daily cloud base. Alternatively, failure to clear 102.13, would risk further consolidation, while slide below 101.41, 29 May low and retest of multi-month base at 101.20, would risk further weakness, with break below low at 100.81/74, 21 May spike low / 04 Feb low, to spark fresh bear-phase and resumption of larger downtrend from 105.43, 02 Jan year-to-date high.

Resistance: 102.13; 102.35; 102.78; 103.09

Support: 101.83; 101.67; 101.41; 101.20





AUD/USD

The pair came under pressure after recovery rally stalled at 0.9330, Fibonacci 61.8% retracement of 0.9407/0.9207 descend and subsequent acceleration lower weakened near-term technicals, retracing over 61.8% of 0.9207/0.9330 upleg. Near-term risk is skewed towards the downside, as 4-hour studies are turning negative and see risk of full retracement of 0.9207/0.9330 upleg. Formation of daily Evening Star Pattern, confirms the notion. Near-term bears may be delayed as hourly studies are oversold, however, only break above 0.9330 lower top would provide relief.

Resistance: 0.9274; 0.9287; 0.9312; 0.9330

Support: 0.9238; 0.9207; 0.9177; 0.9121



AUD/NZD

The pair enters corrective phase off fresh peak at 1.0978, posted on 29 May, as near-term studies became overbought. Good supports lay at 0.0874 platform and 1.0850, Fibonacci 38.2% retracement of 1.0644/1.0978 upleg, where dips should find ideal support for fresh attempt higher and eventual test of psychological 1.1000 barrier, reinforced by 200SMA, break of which to confirm break above short-term congestion and open fresh extension higher, part of recovery rally from 1.0488, 19 Jan annual low. Only slide below 1.0853 higher platform and near 61.8% of 1.0802/1.0978 upleg, would delay bulls.

Resistance: 1.0978; 1.1000; 1.1050; 1.1100

Support: 1.0900; 1.0874; 1.0853; 1.0824



XAU/USD

Spot Gold continues to trend lower, with fresh losses below 1250 handle, reaching 1240 low so far. Bears remain in play and focus next targets at 1237, 30 Jan low and 1231, Fibonacci 76.4% of 1182/1392 ascend, with psychological 1200 support expected to come in focus on a break below the above targets. Corrective action should be ideally limited by 1260 lower top and more significant 1268. Previous congestion floor, with penetration of the latter, to delay immediate bears.

Resistance: 1251; 1260; 1268; 1277

Support: 1240; 1237; 1231; 1215