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EURUSD and GBPUSD Outlooks Positive, Despite US Dollar Rebound

Technical Analysis

The US currency staged a rebound effort late last week, particularly Friday (5th June) after another strong US Employment report.

But recent US Dollar weakness from late July, leaves a positive tone for the Euro and the GB Pound against the US$ into mid-August, although still defined within broader range environments.

EURUSD – Rebound bias in broader range

A deeper dip Friday through 1.1103, 1.1066 and to prod at 1.1049 support, but an intraday rebound from just below here (from 1.1044), reinforces the late July- early August rally above 1.1185/89 resistances and leaves a bounce bias for Monday.

Moreover, the late July push above 1.1189 neutralised the aggressive plunge lower on Friday 24th June (after the UK Referendum result), for an intermediate-term neutral range theme.

For Monday:

  • We see an upside bias through 1.1115 for 1.1156/61; break here aims for 1.1205.
  • But below 1.1044 opens risk down to 1.0992.

Short/ Intermediate-term Range Parameters: We see the range defined by 1.1426 and 1.0950.

Range Breakout Challenge

  • Upside: Above 1.1426 aims higher for 1.1616 and 1.1714.
  • Downside: Below 1.0950 sees risk lower for 1.0910, 1.0823/21, 1.0777/08 and maybe 1.0520.

Daily EURUSD Chart

EURUSD

GBPUSD – Still positive, despite recent losses

A further setback Friday after the US Employment report through a strong foundation area at 1.3070/57/47 (following the Thursday break lower after the Bank of England rate cut through 1.3279, 1.3226, 1.3168, 1.3149)

However, the intraday rebound Friday to probe back above 1.3070/57/47 has signalled reluctance to send a more negative signal and leaves a bounce bias for Monday.

On an intermediate-term outlook, we see a range theme into August.

For Monday:

  • We see a rebound bias for 1.3175/90; break here aims for 1.3250/60 and maybe a key 1.3481 peak.
  • But below 1.3019 opens risk down for 1.3000, 1.2970 and maybe 1.2850.

Short/ Intermediate-term Range Parameters: We see a range defined by 1.2791 and 1.3534.

Range Breakout Challenge

  • Upside: Above 1.3534 aims higher for 1.3642 and 1.3905.
  • Downside: Below 1.2791 sees risk lower for 1.2565, 1.2000 and 1.1880.

 

Daily GBPUSD Chart

GBPUSD

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