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Currency Talk – EUR/GBP, EUR/AUD, AUD/USD

Key takeaways

  • What is the technical outlook for EURGBP, EURAUD, and AUDUSD?

The Overbalance analysis aims to identify three financial instruments, analyzed primarily on the daily/four-hour (D1/H4) timeframe. The analysis uses only the Overbalance methodology, which helps determine where a trend may continue or where it may reverse. Today’s analysis covers three instruments, evaluated solely in terms of 1:1 correction structures. EURGBP From March 20 through the end of the month, EURGBP traded in an uptrend, but the subsequent correction turned into a stronger downtrend. After the 1:1 upward pattern was negated at the 0.8693 level, the declines accelerated. Currently, the 0.8693–0.8688 zone represents key resistance. Only a return of the price above this zone could shift the balance of power on the chart. For now, the base scenario remains a decline toward the lows at 0.8617.

EURGBP – H4 timeframe. Source: xStation EURAUD From March 11 through the end of the month, the EURAUD pair was in an uptrend; however, the largest corrective pattern was subsequently negated at the 1.6680 level, which was then tested from the opposite side. Since then, we have observed the development of a downtrend. The largest current corrective pattern (marked in red) defines a key resistance level at 1.6470. According to the Overbalance methodology, as long as the price remains below this level, the downtrend remains in effect.

EURAUD – H4 timeframe. Source: xStation AUDUSD Since late March, the AUDUSD pair has been in an uptrend. Recently, the exchange rate has twice tested support at the 0.7015 level, which corresponds to the lower boundary of the 1:1 pattern. As long as this level holds, the uptrend remains intact. It is worth noting, however, that another test of this zone could weaken it, increasing the risk of it being broken and thus triggering a larger downward correction.

AUDUSD – H4 chart. Source: xStation

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EUR/USD dips towards 1.1650 with Eurozone inflation, ECB rates on tap

  • EUR/USD drifts to three-week lows near 1.1650 as the Fed turns hawkish.
  • The Federal Reserve left rates on hold, with some policymakers opposing the “easing bias”.
  • Eurozone inflation and the ECB’s monetary policy decision will guide the pair on Thursday.

The Euro (EUR) extends losses for the third consecutive day against the US Dollar (USD) on Thursday, trading at 1.1663 at the time of writing, down from weekly highs at 1.1755. A hawkish shift in the US Federal Reserve’s (Fed) monetary policy stance and the deadlock in the Middle East conflict are buoying the safe-haven USD, ahead of the Eurozone inflation data and the European Central Bank’s (ECB) monetary policy decision, both due later today.

On Wednesday, the Fed left rates on hold at the 3.50%-3.75% band, as expected, yet with the most divided committee since 1992, as three policymakers argued that the “easing bias” phrase is no longer appropriate given the spike in energy prices.

Higher Treasury yields give a fresh push to the USD

The market has priced out the chance of a Fed rate cut this year, according to the CME FedWatch Tool, and now prices in a nearly 50% chance of a rate hike in June next year. This has given US Treasury yields a fresh boost, providing additional support for the US Dollar.

Beyond that, Fed Chairman Jerome Powell, who ends his term on May 15, affirmed that he will remain at the bank as Governor, due to the legal actions taken against him by US President Donald Trump. Powell will replace Stephen Miran, who was appointed by Trump in 2025 and voted for a rate cut on Wednesday, and is likely to counter pressure from the administration on the next Chair, Kevin Warsh, to ease monetary policy.

In Europe, traders will be attentive to the Eurozone preliminary Gross Domestic Product (GDP) for the first quarter and the Harmonised Index of Consumer Prices (HICP) for April, which is expected to show a sharp acceleration, boosted by higher Oil prices.

The main focus on Thursday, however, will be on the ECB’s monetary policy decision. The bank will most likely leave interest rates on hold, awaiting more clarity on the Middle East conflict, while leaving the door open for a rate hike in June or July.

Technical Analysis: Bears are testing a key support zone

EUR/USD Chart Analysis

EUR/USD is showing mounting bearish pressure after breaking the neckline of a bearish “Head & Shoulders” (H&S) pattern at 1.1675, and is now testing a cluster of supports above 1.1645, which held bears several times in mid-April.

Technical indicators on the 4-hour chart are going deeper into bearish territory. The Relative Strength Index (RSI) around 34 hints at lingering downside pressure, and the Moving Average Convergence Divergence (MACD) histogram is showing widening red bars.

A clear break of the April 8 intraday low, in the area of 1.1645, would confirm the H&S formation. The pair might find some support at the 1.1630 area, where the 50% Fibonacci support of the March-April rally meets late March and early April highs. The 61.8% Fibonacci retracement is at 1.1583. The H&S’s measured target is coincident with the April 6 low near 1.1500.

On the topside, immediate resistance emerges at the previous support zone near 1.1675, followed by Wednesday’s high at 1.1720 and the mentioned weekly high at 1.1755.

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BoJ Report: Impact of weak Japanese Yen shock on inflation bigger than that from oil shock

A report released by the Bank of Japan (BoJ) on Thursday revealed that the impact of weak Japanese Yen shock on inflation bigger than that from oil shock. The weakening of the JPY pushes up prices for wide range of goods services, thereby gives bigger boost to consumer inflation excluding fresh food, energy.

Key quotes

Impact of weak Yen shock on inflation bigger than that from oil shock.

Weak Yen pushes up prices for wide range of goods services, thereby gives bigger boost to consumer inflation excluding fresh food, energy.

Oil price rises put fairly big upward pressure on smaller number of goods related to energy, which means impact on CPI excluding fresh food, energy isn’t very big.

Weak Yen shock expands wage, profit margin and leads to increase in GDP deflater, while energy shock squeezes wage, profit margin and leads to decrease in GDP deflater.

Under risk scenario projecting elevated oil prices, weaker Yen, stock falls, real GDP forecasts will be -0.1% point to 0.2% point lower in fiscal 2026-2028 than BoJ’s median baseline projections.

Under risk scenario, core consumer inflation will overshoot significantly from BoJ’s median baseline projections, could hover around 3% in fiscal 2026, 2027.

Such overshoot of inflation could heighten medium-, long-term inflation expectations.

If there is big supply chain disruption, real GDP could undershoot sharply while bottlenecks could lead to non-linear rise in inflation.

BoJ will scrutinise various risk factors more than ever as growth, price developments could sharply deviate from its baseline projections depending on Middle East developments.

Market reaction

As of writing, the USD/JPY pair is up 0.02% on the day at 160.48.

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AUD/USD – Bullish USD to cap recovery from 0.7100/two-week low

  • AUD/USD stages a modest recovery from a two-week low, around 0.7100, touched on Wednesday.
  • The Fed’s hawkish tilt and Iran tensions continue to underpin the USD, warranting caution for bulls.
  • The technical setup suggests that any further move up is likely to be sold into and remain capped.

The AUD/USD pair gains some positive traction during the Asian session on Thursday and recovers a part of the previous day’s heavy losses to the 0.7100 mark, or a two-week low.

Expectations that the Reserve Bank of Australia (RBA) will stick to its hawkish stance counter China’s mixed official PMIs and turn out to be a key factor offering some support to the Australian Dollar (AUD). The US Dollar (USD), on the other hand, sticks to its positive tone near the highest level since April 13 on the back of persistent geopolitical uncertainties stemming from stalled US-Iran peace talks. Furthermore, diminishing odds for any further policy easing by the US Federal Reserve (Fed) underpin the USD and should cap the upside for the AUD/USD pair.

From a technical perspective, spot prices have repeatedly failed to find acceptance above the 0.7200 mark and have oscillated in a range over the past two weeks or so. Meanwhile, the overnight slide confirms a breakdown below the 0.7130-0.7125 confluence – comprising the 100-period Simple Moving Average (SMA) on the 4-hour chart and the 23.6% Fibonacci retracement level of the recent recovery from the year-to-date low touched in March. This, in turn, favors the AUD/USD bears, suggesting that the move higher might now be seen as a selling opportunity.

Moreover, the Relative Strength Index (RSI) holds around 40 and hints at modest bearish momentum. Meanwhile, the Moving Average Convergence Divergence (MACD) is in negative territory but flattening, suggesting downside pressure is softening rather than accelerating.

In the meantime, immediate resistance emerges at the 23.6% Fibonacci retracement at 0.7131, with a stronger barrier at the recent cycle high near 0.7223. On the downside, initial support aligns with the 0.7100 mark ahead of the 38.2% retracement at 0.7074. This is followed by the 50.0% level at 0.7027 and deeper supports at the 61.8% and 78.6% retracements at 0.6981 and 0.6915, respectively, where buyers would likely attempt to slow any extended pullback.

(The technical analysis of this story was written with the help of an AI tool.)

AUD/USD 4-hour chart

Chart Analysis AUD/USD

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Euro.

USDEURGBPJPYCADAUDNZDCHF
USD0.11%0.00%0.00%-0.04%-0.11%-0.08%-0.01%
EUR-0.11%-0.07%-0.13%-0.16%-0.21%-0.17%-0.10%
GBP-0.01%0.07%-0.02%-0.08%-0.12%-0.09%-0.02%
JPY0.00%0.13%0.02%-0.06%-0.11%-0.13%-0.04%
CAD0.04%0.16%0.08%0.06%-0.08%-0.06%0.04%
AUD0.11%0.21%0.12%0.11%0.08%0.04%0.12%
NZD0.08%0.17%0.09%0.13%0.06%-0.04%0.08%
CHF0.00%0.10%0.02%0.04%-0.04%-0.12%-0.08%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote)

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EUR/USD – Hovers around 50-day EMA near 1.1700

  • EUR/USD may hover near its eight-month low around 1.1411.
  • The 14-day Relative Strength Index near 48 signals weakening bullish momentum and a consolidative trend.
  • Immediate resistance is seen at the 50-day EMA near 1.1678.

EUR/USD extends its losses for the third successive day, trading around 1.1660 during the Asian hours on Thursday. The daily chart technical analysis indicates a potential for a bearish reversal, as the pair has slipped below the ascending channel.

The EUR/USD pair holds just under the 50-day Exponential Moving Average (EMA) and the nine-day EMA, which together suggest a capped near-term tone despite the recent recovery from lower levels.

The 14-day Relative Strength Index (RSI) around 48 hints at fading bullish momentum and a consolidative bias, reinforcing the view that upside attempts may struggle while price remains below these key dynamic barriers.

On the downside, the EUR/USD pair may navigate the region around the eight-month low of 1.1411, recorded on March 13.

The immediate resistance lies at the 50-day EMA of 1.1678, followed by the nine-day EMA at 1.1700. A return to the ascending channel would revive the bullish bias and lead the EUR/USD pair to test the two-month high of 1.1849, reached on April 17, followed by the upper boundary of the ascending channel around 1.1940. A sustained break above the channel would lead the pair to explore the region around 1.2082, the highest since June 2021, reached on January 27.

EUR/USD: Daily Chart

Euro Price Today

The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Australian Dollar.

USDEURGBPJPYCADAUDNZDCHF
USD0.09%0.01%-0.03%-0.05%-0.14%-0.07%-0.00%
EUR-0.09%-0.05%-0.13%-0.14%-0.21%-0.14%-0.07%
GBP-0.01%0.05%-0.04%-0.07%-0.15%-0.05%-0.02%
JPY0.03%0.13%0.04%-0.03%-0.10%-0.09%-0.00%
CAD0.05%0.14%0.07%0.03%-0.10%-0.04%0.05%
AUD0.14%0.21%0.15%0.10%0.10%0.07%0.15%
NZD0.07%0.14%0.05%0.09%0.04%-0.07%0.07%
CHF0.00%0.07%0.02%0.00%-0.05%-0.15%-0.07%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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EUR/USD drops as strong US data and Iran impasse lift Dollar bids

  • Strong Durable Goods Orders reinforced confidence in the US economy.
  • Higher yields and firm oil prices supported the Greenback’s rebound.
  • Traders now await Fed and ECB decisions for fresh direction.

EUR/USD drops by some 0.17% during the North American session as a possible resolution of the US-Iran conflict seems far from ending, while Durable Goods Orders data in the US suggest that the economy remains solid. At the time of writing, the pair trades at 1.1684 after reaching a daily high of 1.1720.

Euro weakens as yields jump before Fed and ECB rate decisions now

High energy prices are underpinning the US Dollar, which, of late, has been correlated with WTI, posting back-to-back bullish days and rising 0.27% in the day, according to the US Dollar Index. The DXY, which measures the performance of the buck’s value against a basket of six currencies, is at 98.66.

US Treasury yields are soaring, with the 10-year Treasury note up 5 basis points to 4.398%, a sign that investors are less confident the Federal Reserve will reduce borrowing costs in the near term.

The US President Donald Trump urged Iran to sign a deal as he prepared the US Navy for an extended blockade of Iranian ports, as negotiations have stalled.

Aside from this, US Core Durable Goods Orders in March rose sharply 3.3% from February’s 1.6% print, crushing estimates for a minimal 0.6% increase, a sign that business spending is picking up, driven by companies spending on AI to improve profit margins. Headline goods orders improved from a -1.2% YoY contraction, to 0.8% exceeding forecasts of 0.5%.

Across the pond, the Harmonized Index of Consumer Prices (HICP) in Germany rose from 2.8% to 2.9% YoY, missing estimates of 3%. Monthly, the German HICP decreased form 1.2% to 0.5%, below forecasts for a 0.8% jump.

Fed and ECB meetings up next

Now, traders’ eyes would be on monetary policy meetings in both sides of the Atlantic. The Federal Reserve is projected to keep interest rates unchanged in the 3.50%-3.75% range, but the attention would be on Powell’s decision to stay at the Fed until his term as Governor ends, or whether he would leave his place open, which would increase Trump’s allies on the committee.

On Thursday, the European Central Bank is projected to keep rates unchanged, but for the rest of the year, money markets see three basis points of rate hikes towards the end of the year, as revealed by Prime Terminal’s implied forward rates curve.

Source: Prime Terminal

EUR/USD Price Forecast: Technical outlook

Chart Analysis EUR/USD

In the daily chart, EUR/USD trades at 1.1690, holding just above the triple simple moving average (SMA) clustered around 1.1649, which now acts as immediate support. The pair, however, remains capped by the broader trend structure, with former rising support now sitting above spot near recent highs around 1.1760 and converging with the dominant downward resistance line closer to 1.1800, suggesting rallies are still vulnerable while price trades beneath this confluence. The Relative Strength Index (RSI) at about 50.4 hovers around neutral, hinting at a loss of directional conviction after the recent recovery from mid-1.15s.

On the topside, initial resistance is seen near the former rising-support line around 1.1760, ahead of the broader downward resistance trend zone near 1.1800, where sellers are likely to re-emerge unless the pair can sustain a clear break higher. On the downside, the triple SMA support at roughly 1.1650 is the first level to watch; a daily close below this floor would expose a deeper pullback toward the mid-1.15 area, while holding above it would keep the pair in a consolidative stance within the broader corrective structure.

Euro Price This week

The table below shows the percentage change of Euro (EUR) against listed major currencies this week. Euro was the strongest against the Swiss Franc.

USDEURGBPJPYCADAUDNZDCHF
USD0.05%0.16%0.38%0.03%-0.08%0.43%0.45%
EUR-0.05%0.13%0.26%0.00%-0.11%0.41%0.42%
GBP-0.16%-0.13%0.17%-0.12%-0.24%0.28%0.29%
JPY-0.38%-0.26%-0.17%-0.30%-0.44%0.16%0.18%
CAD-0.03%-0.00%0.12%0.30%-0.07%0.46%0.42%
AUD0.08%0.11%0.24%0.44%0.07%0.52%0.53%
NZD-0.43%-0.41%-0.28%-0.16%-0.46%-0.52%0.02%
CHF-0.45%-0.42%-0.29%-0.18%-0.42%-0.53%-0.02%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).

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BREAKING: Bank of Canada keeps rates unchanged, USDCAD extends gains

Bank of Canada (BoC) Rate Decision:

  • Actual 2.25%
  • Forecast 2.25%
  • Previous 2.25%

The Bank of Canada maintained its policy interest rate at 2.25%, a level held since October. The Governing Council decided to “look through” the immediate inflationary impact of the Middle East war. However, policy remains “nimble,” with potential for rate hikes if energy price shocks lead to persistent, generalized inflation. Economic projections:

  • Inflation Outlook : March CPI inflation rose to 2.4% from 1.8% in February, driven by surging gasoline prices. Inflation is forecast to peak at 3% in April before returning to the 2% target in early 2027.
  • Economic Growth Projections : GDP growth is projected at 1.2% in 2026, rising to 1.7% by 2028 as trade and investment gradually recover. While consumption and government spending support the economy, US tariffs and trade uncertainty—specifically the CUSMA review—weigh on exports. Canada’s net oil exporter status provides some relative resilience.
  • Labor Market and Risks : The labor market is soft, with unemployment between 6.5% and 7%. Key risks include new US trade restrictions, which could trigger rate cuts, or persistent energy price pressures that might necessitate consecutive rate increases. Productivity is seeing an early boost from businesses adopting artificial intelligence technologies.

Source: xStation5

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GBP/USD Price Trades sideways around 1.3500 ahead of Fed-BoE rate decisions

  • GBP/USD wobbles around 1.3500 as the US Dollar consolidates in the countdown to Fed-BoE policy announcements.
  • The Fed is expected to warn of upside inflation risks after leaving interest rates unchanged.
  • Investors expect the BoE to hold interest rates steady at 3.75%.

The GBP/USD pair is broadly sideways around 1.3500 during the European trading session on Wednesday. The Cable consolidates as investors await monetary policy announcements by the Federal Reserve (Fed) and the Bank of England (BoE).

The Fed is anticipated to leave interest rates unchanged in the range of 3.50%-3.75% in its monetary policy announcement at 18:00 GMT, according to the CME FedWatch tool. In the monetary policy statement, the Fed is expected to warn about de-anchored inflation projections and growing economic risks amid higher oil prices due to prolonged Strait of Hormuz closure.

Ahead of the Fed’s policy meeting, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.1% higher to near 98.70.

On Thursday, the BoE is expected to hold interest rates steady at 3.75%, with an 8-1 majority. In an event at the International Monetary Fund (IMF) this month, BoE Governor Andrew Bailey said the war has resulted in a “big negative shock” to the economy; however, there is no rush for any monetary policy adjustment.

GBP/USD technical analysis

GBP/USD trades flat at around 1.3500, holding a modest bullish bias as it sits above the 20-day Exponential Moving Average (EMA) at 1.3470 and the 38.2% Fibonacci retracement at 1.3432.

The Relative Strength Index (RSI) at 55.4 leans slightly positive, suggesting buyers retain the upper hand while upside traction remains gradual.

On the topside, immediate resistance is aligned at the 50.0% Fibonacci retracement at 1.3515, with further barriers at the 61.8% level at 1.3599, followed by 1.3718 and 1.3870. On the downside, initial support is seen at the 20-day EMA at 1.3470, ahead of the 38.2% retracement at 1.3432; a deeper pullback would expose the 23.6% level at 1.3328 and the structural floor near 1.3161.