ECB Uncertainty Weighs On EUR

Uncertainty over the looming ECB governing council meeting weighed on EUR across the board. Also, the release of somewhat mixed macroeconomic data ensured that even though the ECB is widely expected to keep rates unchanged, the pair traded in minor negative territory for much of the session. Technical support levels are seen at the 200-DMA line at 1.3040, the 10-DMA line at 1.2985 and then at the 21-DMA line at 1.2961. On the other hand, resistance levels are seen at 21-DMA upper Bollinger® level at 1.3133, the 76.4% retracement of the 1.3243 to 1.2796 move at 1.3138.

GBP/USD
The release of less than impressive Services PMIs from various EU states, as well as much better than expected Services PMI from the UK, which rose to its highest level since March 2012 meant that GBP/USD outperformed its major counterpart. In terms of technical levels, supports are seen at the 55-DMA line at 1.5285, the 21-DMA line at 1.5234 and then at 1.5193. On the other hand, resistance levels are seen at the 61.8% retracement of the 1.5607 to 1.5008 move at 1.5378 and then at 1.5471.

USD/JPY
The recent price action by the pair indicates that market participants are more than willing to test the resolve of the BoJ which in turn may see the pair edge lower in the near term. In terms of macroeconomic commentary, Japanese PM Abe vowed to slay deflation monster with fiscal and monetary policy and that its time for Japan to become the engine of global economic recovery. Japanese government said they are to aim for 2% real, 3% nominal average GDP growth over the next 10 years, adding that pension funds to seek higher returns from long term stock investments. Technically, support levels are seen at the psychologically important 99.00, which then exposes the ichimoku cloud top c. 99.30/40. On the other hand, resistance levels are seen at 100.07/47 and then at the key 101.00 level.