Tech Targets: EUR/USD, GBP/USD, AUD/USD, NZD/USD, USD/JPY - UOB

EUR/USD: Bearish: Downside potential likely limited to 1.1145.

There is no change to our bearish view but as highlighted previously, downward momentum is not very strong and the downside potential is likely limited to 1.1145. Stop-loss remains unchanged at 1.1395 but 1.1350 is already a strong short-term resistance.

Looking further ahead, this pair has to move below the strong 1.1230 support within the next few days as a prolonged consolidation above this level would lead to a rapid loss of momentum.

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GBP/USD: Neutral: In a broad 1.4000/1.4350 range now.

Improving short-term momentum suggests that a test of the top-end of our expected 1.4000/1.4350 range will not be surprising.

However, the overall outlook is mixed and even a break above 1.4350 is not expected to move significantly above the late March high of 1.4455/60. Yesterday’s low of 1.4130/35 is acting as a strong support and this level should hold, at least for the next few days.

AUD/USD: Change to Bullish: Target a move to 0.7850

Against very slim odds, AUD rallied strongly after touching a low 0.7594 during early Sydney time yesterday. The rally is accompanied by impulsive upward momentum and this coupled with the break above the key 0.7765 resistance suggests that the outlook for AUD has shifted to bullish. The immediate target is for a move to 0.7850, the minor peak seen back in June last year.

In order to maintain the current impulsive momentum, any pull-back should hold above 0.7660.

NZD/USD: Neutral: Daily close above 0.7000 would shift outlook to bullish.

The unexpected strong rally clearly bodes well for NZD but we prefer to wait for a daily closing above 0.7000 before turning bullish.

This appears to be a likely scenario unless there is a move back below 0.6870 in the next 1 to 2 days.

USD/JPY: Neutral: In a broad 107.65/110.00 range.

As mentioned yesterday, only a daily close below 107.50 would indicate that USD has resumed its bearish trend.

The unexpected strong rebound from 107.81 yesterday clearly indicates that the downward pressure has eased and this pair is expected to trade in a broad 107.65/110.00 range for now.