The USD is moving lower as risk sentiment improves and recent defensive flows begin to unwind. With some geopolitical tensions easing, capital is rotating back toward risk assets.
U.S. stocks are higher, with the S&P 500 up about 72 points, while yields are moving lower, with the 10-year yield down roughly 5 basis points. At the same time, oil prices are falling about 1.6%, helping reduce some of the inflation and risk concerns that had supported the dollar last week.
After the strong rally late last week that pushed several major currency pairs to new weekly lows against the USD, the greenback is now giving back some of those gains. In the video above, I break down the technical outlook for the three major pairs: EURUSD, USDJPY, and GBPUSD.
The EURUSD is up 0.55%, reflecting the weaker dollar, and is stretching back toward the broken November highs at 1.1468 and 1.1491. The high today has reached 1.1486, putting the pair right back into that key resistance zone. A sustained move above this area would increase bullish momentum.
The USDJPY is down about 0.38% and has moved back below the January highs, which were briefly broken late last week. Those levels at 159.447 and 159.218 now act as resistance. Staying below those levels keeps sellers in control and shifts focus back toward lower support targets.
The GBPUSD is up around 0.44% and has pushed back above recent swing lows at 1.3252 (two weeks ago) and 1.3282 (last Monday). With the pair reclaiming those levels, the next upside target comes near the 1.3300 area, where traders will look to see if bullish momentum can continue.
Technical levels to watch
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EURUSD: Resistance 1.1468–1.1491, break opens further upside
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USDJPY: Resistance 159.218–159.447, staying below favors sellers
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GBPUSD: Support 1.3252–1.3282, upside target 1.3300
Video summary:
The video walks through the technical setup for EURUSD, USDJPY, and GBPUSD, highlighting how the softer dollar is pushing pairs back toward key resistance levels. The focus is on whether buyers can build momentum above those levels or if the dollar finds support after last week’s strong run.
