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USD Showing a Firmer Tone Near Term

Technical Analysis

 

As we highlighted in our last report, the US currency continues to rally against the Dollar bloc (Australian, New Zealand and Canadian Dollars), but a more positive tone has begun to emerge elsewhere as we approach mid-July.

USDJPY gains and a EURUSD setback after a supposed positive outcome for the Greek Debt Crisis leave a bullish tone for the US Currency against most major currencies within G10.

Only a corrective Cable rebound from last week (GBPUSD higher), sees the US Dollar on the defensive.

Overall, this activity points to a more positive tone now for the US currency through mid-July.

USDJPY

  • A strong rebound rally leaves risks higher into mid-July, back to test a key peak at 123.72
  • Above here would neutralise bearish pressures and set a broader range theme, but with a constructive tone.
  • Below 121.95 is needed to re-energize a more bearish tone.

Daily USDJPY Chart

USDJPY

EURUSD 

  • Still very much defined by a range theme between 1.1436 and 1.0819 into mid-July.
  • However, the more recent failure back from 1.1278 and push down to 1.0914 leaves risk skewed to the downside.
  • Below 1.0819 sets a more bearish tone to challenge 1.0658, 1.0520 and the cycle low at 1.0459.

Daily EURUSD Chart

EURUSD

GBPUSD

  • A solid rebound from last week, from ahead of key trend line and chart support, 1.5169.
  • This leaves a rebound bias back into the setback range into mid-July.
  • However, the underlying base and bull them remain intact for a July challenge back to 1.5930 and 1.6000.

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