Technical Analysis

The dollar recoups some losses in European mid-morning trade

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The pair touched a high of 1.1384 earlier in the session before backing off a little to around 1.1350 levels but has now eased further to a session low of 1.1326.

The dollar appears to be pulling back some of its earlier losses – alongside the yen – helped by a slight nudge lower in risk on US-China headlines. S&P 500 futures were up by over 1.2% but is now holding gains of around 0.9% after the news here.

Elsewhere, the dollar has also pared some losses against the pound and aussie with cable backing away from its 200-day moving average – falling from a high of 1.2690 to 1.2630-40 levels – while AUD/USD is now down to 0.6975 after testing waters above 0.7000.

USD/CAD is also seen bouncing off its 200-day moving average, just off lows of 1.3461 to 1.3480 currently.

There aren’t any major hints of a turnaround in sentiment and the moves could be due to profit-taking activity if anything else as we approach some key levels above.

The same can be said for the EUR/USD rally ahead of the weekend after having posted eight straight days of gains – the longest streak since 2011 (!).

For EUR/USD, buyers remain firmly in control and unless price action starts to threaten dipping back below 1.1300 and keeping a close under there, buyers are still in a good spot.

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