Let’s start off with the EURUSD… It looks like the euro finally posted some major losses against the dollar when bulls failed to make a convincing rally above 1.4700. If this drop back down proves to be sustainable we might see potential support at 1.4500, as this price level served as resistance many times before. Remember, whenever price passes through resistance, that price level could become support. Buying pressures could also be found on around the rising trend line at 1.4400. Conversely, if this move downwards proves to be a retracement, the pair’s next stop north would be this year’s high at 1.4821.
Now, let me update you on yesterday’s USDJPY price action… The pair sank lower after hitting the resistance level at 91.50. It dipped to a low of 90.36 before climbing back to retest the resistance. Upon hitting 91.50, the pair tumbled down again. With the stochastic just making it out of the overbought area, a little more downward price action could be due. The pair could find support at the previous low of 90.36 or at the psychologically significant 90.00 mark. If the pair moves higher, it could encounter resistance again at 91.50.
Now let’s cover the cable using a daily time frame. It appears that the pair was able to break below the head and shoulders’ neckline at 1.6000. The price is currently approaching 1.5900. This level may provide some support where we may see price price bounce back up to retest 1.6000. On the other hand, if the 1.5900 level gives way, then it is very likely for the pair to visit 1.5800.