#EUR/USD and #GBP/USD are expected to continue their downward trend, while USD/JPY is indicating an impending bullish breakout.
EUR/USD has taken a beating recently, with the dollar benefiting from risk-off sentiment and expectations of a sharp rise in US interest rates. The recent drop through $103.4 resulted in the lowest reading since 2002. Unfortunately for the euro, there are few reasons to be bullish as the currency approaches parity.
A break through the $104.89 level would result in a more positive outlook. Until then, any short-term gains are opportunities to sell into the current downtrend.
GBP/USD expected to continue its decline
#GBP/USD has also been under pressure, with the pair hitting a two-year low yesterday. While price has been consolidating somewhat since the Tuesday decline, we have yet to see anything that would inspire bulls with confidence.
As a result, bearish forecasts remain preferable until price breaks through the $1.2165 swing-high.
USD/JPY looks primed for another break higher
USD/JPY has risen dramatically so far in 2022, and we expect further gains to follow. The consolidation seen over the last two weeks may be coming to an end, with price heading up through trendline resistance. A push through the 136.36 level would result in a potential breakout signal, indicating an impending leg higher.
There is also a risk that we will continue to trade in a sideways pattern, which highlights the significance of the 137.00 handle as a breakout indicator. A drop below 134.74 would be required to signal a more pessimistic short-term outlook.