EUR/USD Upward Correction Imminent Today

EUR/USD Upward Correction Imminent Today

USD/JPY

USDJPY Area of Interest | Support at 38.2% Fibonacci Level

USDJPY has retreated off its previous highs past the 109.50 minor psychological level and appears to be retracing to the Fibonacci levels marked on the 1-hour time frame. For now, price is finding support at the 38.2% level, which is close to the previous resistance area.

Stochastic is still pointing down, indicating that there’s enough selling pressure left for a deeper retracement. In this case, price could still retreat to the lower Fib levels, which are nearer the simple moving averages. In particular, the 100 SMA is in line with the 50% Fibonacci retracement level while the 200 SMA is in line with the 61.8% Fibonacci retracement level.

In addition, the 61.8% Fibonacci level is in line with the 109.00 major psychological level, which could act as a line in the sand for any corrections. MACD is also moving down, hinting at the buildup of selling pressure at the time being

A break below the Fib levels might confirm a deeper pullback, possibly until the longer-term Fibonacci levels on the 4-hour or daily chart. The 108.50 minor psychological level might also hold as near-term support in a large correction. A continuation of the climb could push USDJPY past the 109.50 mark on the way to the 110.00 major psychological handle.

GBP/USD 

GBPUSD Falling Trend Line Resistance | Short-Term Downtrend

GBPUSD looks ready to resume its selloff as the pair is already finding resistance at the falling trend line connecting the highs on the 1-hour chart. However, stochastic is still climbing, which means that buyers are still in control of price action.

This could lead to an upside break from the short-term trend line and perhaps a test of the simple moving average resistance. The 100 SMA is near the 1.6300 major psychological resistance while the 200 SMA is closer to the 1.6350 minor psychological resistance. With the shorter-term SMA just crossing down the longer-term SMA, the downtrend is confirmed.

MACD is on middle ground, not offering clear clues at the moment. This suggests that GBPUSD price action could go either way, with price potentially making a higher bounce or eventually resuming its decline.

An upside break from the trend line and SMAs might lead to an uptrend for GBPUSD, which could take price up to the previous highs near the 1.6500 major psychological level. On the other hand, a resumption of the decline could lead to attest of the 1.6200 support or a move down to 1.6000.

EUR/USD

EURUSD Potential Pullback | Simple Moving Averages Resistance

The recent EURUSD drop appears to be overdone, as price has made a bullish divergence and hinted at a possible strong bounce. Stochastic is moving out of the oversold zone, confirming that euro bears are exhausted and that bulls might take control for now.

They could push price up to the 100 simple moving average, which is around the 1.2735 area for now. A higher bounce could last until the falling trend line resistance, which is in line with the 200 SMA and the 1.2800 major psychological mark.

If this holds as resistance, EURUSD could resume its drop to the previous lows near the 1.2675 or lower to 1.2600. On the other hand, an upside break from the trend line could lead to a short-term uptrend and a larger market correction for this pair.

It is also possible that a downside break from the current consolidation pattern could take place, as fundamentals strongly favor further losses for this pair. A strong break below the 1.2650 minor psychological mark could indicate that bears are back in action and that a stronger move all the way down to the 1.2500 might be in the cards.