Despite Recent Rebound, the US$ Stays Vulnerable Within G3
The US Dollar has managed a decent rebound effort versus both the Euro and Japanese Yen since 18th march, but this is viewed as corrective in nature, with notable US$ resistance factors still intact.
Moreover, more aggressive negative pressure throughout March and immediately after the FOMC Meeting on Wednesday 16th March, again sees risks for further EURUSD rallies and USDJPY erosion into early April.
A resilient rebound Monday from just below retrace support at 1.1143 (from 1.1142) through minor 1.12000 resistance, after a grind lower last week through modest supports, but the recovery effort reinforces the intermediate term bull theme and sees an upside bias for Tuesday.
For Tuesday/ Wednesday:
- We see an upside bias for 1.1262; break here aims for 1.1310.
- But below 1.1142 opens risk down to 1.1082.
Short/ Intermediate-term Outlook – Upside Risks: A strong rally through the 10/03 ECB Meeting through 1.1157 shifted the intermediate term outlook to bullish.
- We see a positive tone with the bullish threat to 1.1376/95.
- Above here targets 1.1495 and maybe 1.1714.
What Changes This? Below 1.0821 signals a neutral tone, only shifting negative below 1.0708.
Daily EURUSD Chart
A firm bounce last week to push above various, latter March breakdown resistances, but a stall at the barrier at 113.82 and a modest setback sees a downside bias again for Tuesday.
- We see a downside bias for 112.85; break here aims for 112.10, maybe towards 111.37.
- But above 113.69 aims through 113.82 and opens risk up to 114.14.
Short/ Intermediate-term Outlook – Downside Risks:
- We see a negative tone with the bearish threat to 110.33/00.
- Below here targets 106.65/12.
What Changes This? Above 114.88 signals a neutral tone, only shifting positive above 117.53.
Daily USDJPY Chart