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CURRENCIES TECHNICAL ANALYSIS May.7

Euro

 

The EUR/USD pair is still holding a bearish note. Sellers broke below 1.1950 in the morning and continued dragging the euro lower afterwards. They reached the 1.1900 support level in the late European session and regained the level right after testing it. The resistance resides at 1.1950, the support comes in at 1.1900.

 

Sellers will most likely to dominate this week. We believe that the euro has “room to extend lower” to 1.1900 or even 1.1800. However, the spot is undervalued and may correct to 1.1950.

 

GBP/USD

 

The pound remained weak on Monday. The GBP/USD spent the first part of the day hovering above 1.3500. The selling pressure increased in the mid-European session and the sterling slowly started losing its value. The resistance lies at 1.3600, the support comes in at 1.3500.

 

The growing selling pressure is pointing a possible break below 1.3500 in the upcoming sessions.

 

USD/JPY

 

The bid tone around the US dollar is getting stronger. The major started its recovery in the mid-Asian session. They reclaimed the 109.00 level first and then continued their rally towards 109.50. The resistance resides at 109.50, the support comes in at 109.00.

 

Buyers are threatening the 109.50 hurdle now. This EMA50 is defending this level, however, taking into consideration buyers’ strength the spot will most likely regain this level without any problem. A cut here will open the doors for a move towards 110.00.

GBP/JPY

 

The bearish scenario still prevails in the market. However, the selling pressure partly weakened when the GBP/JPY pair found a strong support at 147.00. Sellers gave up control after unsuccessful attempt to regain this level. As a result, the currency pair returned to the 148.00 hurdle and is struggling hard to regain it now. The resistance lies at 148.00, the support is at 147.00.

 

If sellers regain control, they may move the market to the 146.00 handle this week.

 

EUR/JPY

 

The recent recovery stalled when the EUR/JPY pair touched the 130.50 hurdle. A failed test of this barrier caused a pull back to the 130.30-130.00 area. The resistance lies at 130.50, the support is at 130.00.

 

The pair may extend its losses and move to the 130.00 resistance today. A decisive break below this handle will open the way towards 129.50.

 

NZD/USD

 

Sellers still control the market. They lost momentum when the NZD/USD pair reached the level 0.7000 last week. The pair pulled back and reverted a minor portion of its losses. Buyers drove the NZD to 0.7050 where they lost momentum. Sellers returned in town after that and started to sell the spot towards 0.7000. They reached this obstacle ahead of the NY opening and kept pressuring the level until it was broken. The resistance stands at 0.7050, the support is at 0.7000.

 

We believe sellers will preserve control in the short-term. If so, the spot will extend its losses and will move below the immediate support.

 

S&P500

 

The downward structure is still intact. When sellers faced buying rejection at 2610 the price jumped to the upper limit of the range to the 2670 area. This region contains a number of EMAs which blocked buyers’ advance. The resistance lies at 2670, the support exists at 2640.

 

S&P500 will have a potential to extend its recovery only if retakes 2670. In this potential scenario buyers might lead the index towards 2700 this week. If they fail, the benchmark will return to the downside and will move to 2610 again.

 

DAX

 

DAX preserved its positive bias on Monday. The benchmark opened on a positive note and continued last week rally after that. The index pushed away from 12800 and headed towards 12900. The resistance lies at 12900, the support exists at 12800.

 

If buying pressure persists, DAX may regain the 12900 area in the upcoming sessions.

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