EUR/USD: Neutral: Weak undertone but only daily closing below 1.0775/80 would indicate start of bearish phase.
While the rapid and sharp drop last Friday was unexpected, we are not convinced that the current movement is the start of a sustained down-move in EUR/USD. However, the undertone is clearly weak but only a daily closing below 1.0775/80 would indicate the start of a bearish phase.
Even then, the downside potential is likely limited to a retest of last month’s low near 1.0710.
GBP/USD: Neutral: 1.4410/15 is extent of corrective rebound, in a broad 1.4080/1.1.4420 range now.
The sharp drop last Friday indicates that the 1.4410/15 high is the extent of the corrective rebound and the ideal level of 1.4450 mentioned previously is not met.
The outlook from here is rather mixed and this pair is expected to trade in a broad 1.4080/1.4420 range, at least for another several more days.
AUD/USD: Neutral: Daily closing above 0.7110 would indicate start of a sustained up-move.
As mentioned last Friday, despite improving momentum, only a daily closing above 0.7110 would indicate the start of a sustained up-move in AUD/USD.
In the meanwhile, this pair is expected to trade sideways, albeit with a positive tone with strong support at 0.7005/10..
NZD/USD: Neutral: Likely trapped between 0.6410 and 0.6555 for now.
There is not much to add as NZD/USD popped higher last Friday but did not threaten the key resistance at 0.6555.
The outlook remains mixed and we continue to hold the view that this pair is likely between 0.6410 and 0.6555 for now.
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