EUR/USD Bearish While USD/JPY Eyes More Gains, Fed Decision Next

FXOpen

EUR/USD failed to move past 1.1745 and declined sharply. USD/JPY is placed nicely in an uptrend and it could move above 112.00. The Fed interest rate decision is likely to ignite moves in both pairs today.

Important Takeaways for EUR/USD and USD/JPY

  • The Euro struggled once again to clear the 1.1745 and 1.1750 resistance levels.
  • EUR/USD cleared a key bullish trend line at 1.1695 on the hourly chart.
  • USD/JPY is placed nicely in a bullish zone above the 111.55 support level.
  • It could accelerate gains once buyers break the 112.00 barrier.

EUR/USD Technical Analysis

The Euro moved higher once again above the 1.1680 and 1.1710 resistance levels against the US Dollar. However, the EUR/USD pair faced a strong barrier near the 1.1745 and 1.1750 resistance levels.

The pair failed once again near the 1.1745 resistance and declined. It seems like the pair formed a double top pattern near the 1.1745 resistance level and it is likely to extend declines in the near term.

EUR/USD Technical Analysis Chart

During the recent decline, the pair broke the 38.2% Fib retracement level of the last wave from the 1.1620 low to 1.1745 high. Moreover, there was a break below a key bullish trend line at 1.1695 on the hourly chart.

It opened the doors for more losses and the pair settled below the 1.1695 support and the 50 hourly simple moving average. It is currently testing the 50% Fib retracement level of the last wave from the 1.1620 low to 1.1745 high at 1.1680. Below this, the pair could accelerate declines towards the next support at 1.1660.

On the flip side, if the pair moves higher, the broken support at 1.1695 and the 50 hourly SMA are likely to prevent gains in the near term.

Today, the Euro Zone CPI Manufacturing Purchasing Managers Index (PMI) for July 2018 will be released. The market forecast is of no change from the last reading of 55.1. If the actual result misses the forecast, there could a downside push in EUR/USD.

USD/JPY Technical Analysis

The US Dollar formed a solid support base near the 110.70 and 110.80 levels against the Japanese Yen. The USD/JPY pair started an upward move and traded above the 111.00 and 111.50 resistance levels.

During the rise, the pair broke a major bearish trend line with resistance at 111.05 on the hourly chart. Later, the pair breached and settled above the 111.20 barrier and the 50 hourly simple moving average.

USD/JPY Technical Analysis Chart

It opened the doors for upsides and the pair surged above the 111.55 and 111.60 resistance levels. A high was formed at 111.95 and the pair is currently consolidating gains. On the downside, an initial support is near the 23.6% Fib retracement level of the last wave from the 110.75 low to 111.95 high.

Below the 111.65 support, the pair is likely to find bids near the 111.57 level, which was a resistance earlier. Therefore, if the pair corrects lower, it may perhaps find supports near 111.65 and 111.57.

On the upside, the recent high and 112.00 are immediate hurdles for buyers. A successful close above 112.00 could clear the path for more upsides towards the 112.40 and 112.50 levels.

Today’s Fed interest rate decision is the main risk event during the US session, and it may perhaps create swing moves in both EUR/USD and USD/JPY.

Trade global forex with the Innovative Broker of 2022*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about trading forex with FXOpen.

* FXOpen International, Innovative Broker of 2022, according to the IAFT

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

EUR/USD, GBP/USD, USD/JPY Analysis: US Dollar Falls to Its Lowest Level Since Mid-August EUR/USD Analysis: Price Reaches the Level of 1.1000 Market Analysis: EUR/USD Extends Rally While USD/JPY Nosedives USD/JPY, GBP/USD, and EUR/USD Market Analysis: The US Dollar Continues to Fall Market Analysis: Australian Dollar Reaches Its Highest Since Early August

Latest articles

Forex Analysis

EUR/USD, GBP/USD, USD/JPY Analysis: US Dollar Falls to Its Lowest Level Since Mid-August

EUR/USDThe euro strengthened on Monday as the dollar fell on expectations that the Federal Reserve will not raise rates again. Traders this week will have to weigh data on how the US economy performed in the third quarter, as

Indices

NASDAQ Composite Index Heralds a Fine Time for Tech Stocks

In the ever-fluctuating landscape of financial markets, the NASDAQ exchange, home to some of the world's most prominent technology stocks, has been a bastion of volatility over the past two years. This week, the NASDAQ index continues its upward trajectory,

Trader’s Tools

Fibonacci Retracement Strategies

Fibonacci retracements are a cornerstone in the toolkit of many traders, offering a mathematical approach to identifying potential areas where reversals may occur. This article delves into the intricacies of using Fibonacci retracements, covering everything from basic understanding to strategies

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.