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FX analysis

Short-term FX technical strategy (7 April 2022)


EUR/USD – Broke below 1.0935, bearish trend resumes

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The EUR/USD has failed to stage the preferred minor corrective rebound as per highlighted in our previous report dated on 5 April and broke below 1.0935. Flip back to a bearish bias below 1.1000 key short-term pivotal resistance for a potential drop towards 1.0850 and 1.0800/1.0770 next.

On the other hand, a clearance with an hourly close above 1.1000 invalidates the bearish tone to revive the minor corrective bounce scenario towards the next intermediate resistance zone of 1.1040/1060.

GBP/USD – Maintain bearish bias below tightened 1.3110 key resistance

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The GBP/USD has continued to inch downwards as expected. Tightened the key short-term pivotal resistance to 1.3110 from 1.3175 (highlighted previously in our report on 5 April) and maintain bearish bias towards the next support at 1.3030 with an extension to 1.3000.

On the other hand, a clearance with an hourly close above 1.3110 invalidates the bearish tone for a squeeze up to test the 1.3175 minor range resistance in place since 30 March 2022.

USD/JPY – Uptrend remains intact, tightened key support to 122.30

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The USD/JPY has managed to pierce higher as expected and surpassed the 123.30 potential upside trigger as per highlighted on our previous report on 4 April. Maintain bullish bias with a tightened key short-term pivotal support now at 122.30 for a further potential impulsive up move towards 124.70 and 125.30/80 major range resistance next.

However, a break down with an hourly close below 122.30 negates the bullish tone for a slide to retest the critical 121.30 short-term support (swing low areas of 25/30/31 March 2022).

AUD/USD –Mixed elements, turn neutral for now

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AUD/USD has staged a failure bullish breakout post RBA meeting; it pierced above the 0.7560 with a 4-hour close above it but reintegrated back below 0.7560 yesterday which suggests a lack of bullish conviction.

Mixed elements now in the short-term coupled with the hourly RSI oscillator now at an oversold level of 29% that led to a rebound in prior price actions when a similar oversold level was hit on 15 March 2022. Prefer to turn neutral between 0.7560 and 0.7470 for now.

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