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On the hourly chart of EUR/USD at FXOpen, the pair started a fresh decline below the 1.0845 support. The Euro declined below the 1.0810 support against the US Dollar.

The pair retested the 1.0765 support and is currently consolidating losses. On the upside, immediate resistance is near a connecting bearish trend line on the same chart at 1.0790.

The next major resistance is near the 50-hour simple moving average at 1.0810. A break above the 1.0810 resistance zone could start a decent increase toward the 1.0845 zone. A close above the 1.0845 level might start a strong increase toward the 1.0940 resistance.

Conversely, the pair might resume its decline from the 1.0765 level. Initial support is near the 1.0750 zone. The next major support is near 1.0700, below which EUR/USD could test the 1.0680 support.

• Japan Core CPI rises
• USD/JPY in negative territory

The Japanese yen is in positive territory today, in what could be the end of a 6-day rally by the US dollar. During that time, the yen has plunged 440 points and hit a six-month low on Thursday. In the European session, USD/JPY is trading at 138.13, down 0.41%.

Japan’s Core CPI rises to 3.4%

Inflation continues to rise in Japan. Core consumer inflation climbed to 3.4% y/y in April, up from 3.1% in March and matching the estimate. This indicator excludes fresh food but includes energy items. The index which excludes both food and energy, which is closely watched by the Bank of Japan, jumped 4.1% y/y in April, its highest level since September 1981.

The rise in inflation, coupled with a first-quarter GDP which surprised on the upside, has raised speculation that the BoJ could begin to phase out the Bank’s ultra-loose policy, which has been in place for decades. The new Governor, Kazuo Ueda, has said that he would not change policy until inflation was sustainably around 2 per cent and wage growth strengthened. Inflation has been above the Bank’s 2% target for over a year, and the markets are monitoring every comment coming out of the BoJ, looking for any hints of a shift in policy.

The BoJ has long played a game of cat-and-mouse with speculators, who are betting that Ueda will make a move to tighten policy, which would push the yen higher. With the yen below the 138 line and 140 looming closer, the possibility increases that the government will intervene in the currency markets to stabilize the yen and fire a salvo at speculators.

It’s an unusually quiet economic calendar in the US today, with no data releases. The markets will have a chance to focus on Fedspeak, with Jerome Powell and two FOMC members delivering public remarks. Just a few weeks ago, the markets had priced in a pause at the June meeting at over 90%. That has changed to a 66% chance of a pause and a 33% chance of a hike of 25 basis points, according to CME’s FedWatch. That downward revision is due to a consistently hawkish message from the Fed and a surprisingly robust US economy.

USD/JPY Technical

• USD/JPY faces resistance at 138.42 and 140.43
• There is support at 137.08 and 136.42

Daily Pivots: (S1) 0.8667; (P) 0.8684; (R1) 0.8698; More...

Intraday bias in EUR/GBP remains neutral as consolidation from 0.8660 is extending. Further decline is expected as long as 0.8758 resistance holds. On the downside, break of 0.8660 will resume recent decline to 100% projection of 0.8977 to 0.8717 from 0.8874 at 0.8614. Nevertheless, break of 0.8758 minor resistance will turn bias back to the upside for stronger rebound.

In the bigger picture, current development argues that whole decline from 0.9267 (2022 high) is still in progress. This is part of the long term range pattern from 0.9499 (2020 high). Deeper fall would be seen through 0.8545 support. his will now remain the favored case as long as 0.8874 resistance holds.

Daily Pivots: (S1) 1.6232; (P) 1.6290; (R1) 1.6324; More...

Intraday bias in EUR/AUD stays neutral for the moment. Further decline is expected with 1.6354 minor resistance intact. Considering bearish divergence condition in D MACD, fall from 1.6785 might be a correction to whole up trend from 1.4281. Break of 1.6134 will target 38.2 retracement of 1.4281 to 1.6785 at 1.5828, which is inside 1.5254/5976 support zone. Nevertheless, sustained break of 1.6354 minor resistance will turn bias back to the upside for retesting 1.6785 high instead.

In the bigger picture, whole down trend from 1.9799 (2020 high) should have completed at 1.4281 (2022 low). Further rise should be seen to 61.8% retracement of 1.9799 to 1.4281 at 1.7691 next. For now, outlook will stay bullish as long as 1.5976 resistance turned support holds, even in case of deep pull back.

Daily Pivots: (S1) 148.96; (P) 149.21; (R1) 149.63; More....

EUR/JPY breached 149.25 resistance briefly but quickly retreated. Intraday bias remains neutral. On the upside, firm break of 149.25 resistance will argue that pull back from 151.60 has completed at 146.12 already. Stronger rally should be seen back to retest 151.60. On the downside, however, break of 146.12 will resume the fall to 61.8% retracement of 139.05 to 151.60 at 143.84.

In the bigger picture, rise from 114.42 (2020 low) is in progress. Next target is 61.8% projection of 124.37 to 148.38 from 138.81 at 153.64. Sustained break there will pave the way to 100% projection at 162.82. For now, medium term outlook will remain bullish as long as 139.05 support holds, even in case of deep pull back.

Daily Pivots: (S1) 171.49; (P) 171.83; (R1) 172.45; More...

Intraday bias in GBP/JPY stays neutral as it's staying in range below 172.30. On the upside, break of 172.30 will resume larger up trend to 100% projection of 148.93 to 172.11 from 155.33 at 178.51. Nevertheless, firm break of 167.82 support should confirm short term topping, and turn bias back to the downside for deeper pull back to 165.40 support and possible below instead.

In the bigger picture, focus stays on 172.11 resistance (2022 high). Decisive break there will resume whole up trend from 123.94 (2020 low). Next target will be 161.8% projection of 122.75 (2016 low) to 156.59 (2018 high) from 123.94 at 178.69. Nevertheless, firm break of 165.40 support will indicate rejection by 172.11 and extend the corrective pattern from there with another falling leg.

Daily Pivots: (S1) 0.9729; (P) 0.9745; (R1) 0.9763; More...

EUR/CHF continues to lose downside momentum as seen in 4H MACD, but there is no sign of bottoming yet. But while deeper fall cannot be ruled out, strong support should be seen from 0.9704 to bring rebound. Break of 0.9847 will argue that choppy fall from 0.9995 has completed and turn bias back to the downside. However, firm break of 0.9704 will resume the whole decline from 1.0095 to 61.8% retracement of 0.9407 to 1.0095 at 0.9670.

In the bigger picture, prior rejection by 38.2% retracement of 1.1149 to 0.9407 at 1.0072 suggests that medium term outlook is staying bearish. The pair is also capped below 55 W EMA (now at 0.9963). Down trend from 1.2004 is not completed yet and is in favor to resume through 0.9407 at a later stage. However, decisive break of 1.0095 resistance will raise the chance of bullish trend reversal. Rise from 0.9407 should then target 1.0505 cluster resistance (2020 low at 1.0505, 61.8% retracement of 1.1149 to 0.9407 at 1.1484).

AUD/USD struggled to stay above 0.7000 and corrected lower. Similarly, NZD/USD is facing strong resistance near 0.6540.

Important Takeaways for AUD/USD and NZD/USD Analysis

• The Aussie Dollar started a downside correction from the 0.7150 zone against the US Dollar.
• There is a crucial bearish trend line forming with resistance near 0.6900 on the weekly chart of AUD/USD at FXOpen.
• NZD/USD also started a steady increase above the 0.5750 and 0.6000 levels.
• There is a key bearish trend line forming with resistance near 0.6365 on the weekly chart at FXOpen.

AUD/USD Technical Analysis

On the weekly chart of AUD/USD at FXOpen, the pair climbed higher above the 0.6540 and 0.6900 resistance levels. However, the Aussie Dollar failed to clear the 0.7150 zone against the US Dollar.

As a result, there was a bearish reaction from the 0.7150 zone. The pair corrected lower below the 0.6900 pivot level and the 50-week simple moving average. Besides, there was a spike below the 50% Fib retracement level of the upward move from the 0.6170 swing low to the 0.7157 high.

On the AUD/USD chart, the pair is now showing bearish signs below the 50-week simple moving average and a crucial bearish trend line with resistance near 0.6900. Only a successful daily close above 0.6900 might start a strong recovery toward the 0.7150 level.

Any more gains might send the pair toward the 0.7550 level. The next major resistance sits near the 0.8000 resistance. On the downside, the first major support is near the 61.8% Fib retracement level of the upward move from the 0.6170 swing low to the 0.7157 high at 0.6540.

The next major support is near the 0.6400 level, below which the pair may perhaps extend its decline toward the 0.6170 level. Any more losses might call for a move toward the 0.6000 level.

NZD/USD Technical Analysis

On the weekly chart of NZD/USD at FXOpen, the pair started a steady increase from the 0.5510 zone. The New Zealand Dollar was able to surpass the 0.5750 and 0.6025 resistance levels. There was also a close above the 50-week simple moving average and RSI settled above 50.

However, the pair failed to clear the 0.6540 level. A high is formed near 0.6538 and the pair is now showing a few bearish signs. It moved below the 23.6% Fibonacci retracement level of the upward move from the 0.5511 swing low to the 0.6538 high.

On the downside, the 0.6025 level is a decent support on the NZD/USD chart since it coincides with the 50% Fibonacci retracement level of the upward move from the 0.5511 swing low to the 0.6538 high.

The next major support is near 0.5750, below which NZD/USD might decline toward the 0.5510 support zone. Any more losses could open the doors for a drop toward the 0.5200 level.

Immediate resistance on the upside is near a key bearish trend line at 0.6365. The first major resistance on the upside is near the 0.6540 level. A successful close above 0.6540 could start a solid upward move toward the 0.7000 resistance. Any more gains might send the pair toward the 0.7230 level.

USDCAD is edging lower today but it appears to be in a delicate balance. It is hovering inside the rather busy 1.3482-1.3536 area, as the pair seems to be taking a breather from the downward move that commenced on March 10, 2023. The aggressive convergence of the simple moving averages (SMAs) employed here and the trendless Average Directional Movement Index (ADX) confirm the current range-trading phase.

The stochastic oscillator could offer a potential way out of the current deadlock. It is hovering at its 50-midpoint, but it is also testing the support set by its moving average. A break lower could encourage the bears to push for another lower low in USDCAD. Their first aim would be to break the current 1.3482-1.3536 range populated by the 50-, 100- and 200-day SMAs and the October 4, 2022 low respectively. They would then set their eyes on the 38.2% Fibonacci retracement of the April 5, 2022 – October 13, 2022 uptrend at 1.3375, a tad ahead of the double bottom pattern lows at the 1.3300-1.3314 area.

On the other hand, a bounce higher by the stochastic oscillator could assist the bulls into staging a new rally and limit the recent losses. In addition, there is a bullish double-bottom pattern (bottoms on April 14 and May 8) developing in USDCAD. However, the bulls should avoid jumping the gun as, for the pattern to be valid, the 1.3667 neckline has to be broken first. Should this occur, the potential upside target from this pattern is in the 1.3900 region.

Provided that they clear the much talked about 1.3428-1.3536 area, the bulls would then look for a retest of the 23.6% Fibonacci retracement at 1.3605. Even higher, the double bottom neckline at 1.3667 and the December 16, 2022 high at 1.3704 respectively could prove tougher to crack.

To sum up, USDCAD is at a critical point. The bears appear to have the upper hand due to the downward move since the March 10 high, but the bulls are itching for the completion of the double bottom pattern.

Short term Elliott Wave View in S&P 500 (SPX) shows the Index ended wave 3 at 4186.92 and pullback in wave 4 ended at 4048.4. Internal subdivision of wave 4 unfolded as a zigzag Elliott Wave structure. Down from wave 3, wave ((a)) ended at 4089.72 and rally in wave ((b)) ended at 4148.3. Final leg wave ((c)) lower ended at 4048.47. The Index has resumed higher and broken above wave 3, confirming that wave 5 has started. Wave 5 is unfolding as a 5 waves impulse structure with an extension.

Up from wave 4, wave ((i)) ended at 4147.02 and pullback in wave ((ii)) ended at 4098.92. The Index then resumes higher again in wave ((iii)) in 5 waves of a lesser degree. Up from wave ((ii)), wave (i) ended at 4147.32 and dips in wave (ii) ended at 4099.12. Up from there, wave i ended at 4141.25, wave ii ended at 4109.86. Wave iii ended at 4186.2, wave iv ended at 4160.04. Final leg wave v is expected to end soon which should complete wave (iii). Afterwards, it should pullback in wave (iv) before the rally resumes again. Near term, as far as pivot at 4048.47 low stays intact, expect pullback to find support in 3, 7, 11 swing and Index to resume higher.

S&P 50 (SPX) 45 Minutes Elliott Wave Chart

SPX Elliott Wave Video

https://www.youtube.com/watch?v=_4fAY1PIpmI