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FX Analysis

Short-term FX Technical Strategy (6 May 2022)

foreign exchange

EUR/USD – Potential impulsive down move resumes

(click to enlarge chart)

The EUR/USD has staged the expected short-term corrective bounce and almost hit the 1.0650 resistance as per highlighted in our previous report dated on 4 May 2022 (printed an intraday high of 1.0642 on 5 May).

Key technical elements have turned bearish that indicates the medium-term impulsive down move sequence is likely to have resumed. Flip back to a bearish bias below 1.0650 key short-term pivotal resistance for a further potential push down to retest 1.0460 (the March 2015 major swing low) and a break below it exposes 1.0410 next.

However, a clearance with an hourly close above 1.0650 invalidates the bearish tone for an extension of the short-term corrective bounce towards the next resistance at 1.0770.

GBP/USD – Short-term bounce failed to hit 1.2700, bearish reaction

(click to enlarge chart)

The initial post FOMC short-term bounce has lose momentum (printed an intraday high of 1.2638 on 4 May US session, below the 1.2700 resistance/target as per highlighted in our previous report dated on 4 May) and reversed to downside post BoE monetary policy decision to shape a lower low.

Flip back to a bearish bias below 1.2640 short-term pivotal resistance for a further potential down move towards 1.2250 and below it sees 1.2100 next. On the other hand, a clearance with an hourly close above 1.2640 revives the short-term corrective bounce scenario towards the next resistance at 1.2840/2860.

USD/JPY – Held above the 128.20 key short-term support, bullish tone intact

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No change for USD/JPY, short and medium-term uptrend phases intact. Maintain bullish bias above 128.20 key short-term pivotal support and a break above the 130.55 upside trigger level is likely to reinforce another potential leg of impulsive up move towards the next resistance at 132.00 in the first step and above it sees 133.20 next.

On the flipside, a break with an hourly close below 128.20 invalidates the bullish tone for a multi-week corrective decline towards the next support at 126.30/125.80.

AUD/USD – Potential impulsive down move resumes

(click to enlarge chart)

The AUD/USD has staged the expected short-term corrective bounce and hit the 0.7230 resistance as per highlighted in our previous report dated on 4 May 2022 (printed an intraday high of 0.7265 on 4 May US session).

Key technical elements are now suggesting the potential impulsive down move of its medium-term down trend phase has resumed. Bearish bias below 0.7270 key short-term pivotal resistance for a further potential drop to test the major support of 0.7000 (swing lows area of November/December 2021 & January/February 2022) in the first step.

However, a clearance with an hourly close above 0.7270 negates the bearish tone for a squeeze up towards the next intermediate resistances at 0.7340 and 0.7400.

Time stamped: 6 May 2022 at 8.00am SGT

Source: TradingView

 


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