Intraday Market Analysis: USD Weakens Across the Board.
EURUSD tests key supply zone
The euro jumped after the ECB announced it will cut its bond-buying program. The pair’s latest retreat seems to have been an accumulation phase for the bulls.
Strong buying interest lies in the demand zone around 1.1230. A break above 1.1320 has put buyers back in the control room. 1.1380 from a previously botched reversal attempt is a major hurdle ahead.
Its breach may trigger an extended rally towards 1.1460. The RSI’s overextended situation has caused a brief pullback with 1.1270 as a key support.
GBPUSD attempts bullish reversal
Sterling surged after the Bank of England raised its interest rates to 0.25%. The pound has been treading water above 1.3170. The sellers’ struggle to push lower and the buyers’ attempts above 1.3260 suggest that the mood could be improving.
A break above 1.3300 has prompted the bears to cover, attracting momentum traders in the process with 1.3440 as the next target. That said, an overbought RSI may cause a temporary pullback as intraday traders take profit.
1.3260 has become the closest support.
NZDUSD breaks resistance
The New Zealand dollar rallied as risk sentiment made its return post-FOMC.
A bullish RSI divergence indicates a deceleration in the sell-off momentum. The long candle wick from 0.6700 suggests solid buying interest. Then a break above 0.6800 has put the last sellers under pressure.
An overbought RSI has limited the initial surge. A pullback may test 0.6755, previously a resistance that has turned into a support. 0.6860 near the 30-day moving average is the next hurdle, and its breach could trigger a bullish reversal.
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