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The eases below broken 200SMA in early European trading following narrow consolidation under new high at 110.45 in Asia.

Tuesday's strong rally which resulted in eventual break and close above 200SMA was strong bullish signal.

Rally may take a breather before push through initial barrier at 110.48 (02 Feb high) and extension towards targets at 110.84/87 (27 Nov low / Fibo 61.8% of larger 114.73/104.63 fall).

Dips are expected to offer better buying opportunities and should find supports at 109.80 (bull-trendline off 104.63 low) and 104.50 (10SMA).

Caution on break below 10SMA which could trigger deeper pullback as formation of daily RSI / MACD bearish divergence warns.

Res: 110.48, 110.87, 111.00, 111.65
Sup: 110.00, 109.80, 109.50, 109.21

The Euro hit new five-month low in Asian session on Wednesday, in attempts to extend strong fall of Tuesday when the pair was down almost 1% and fully retraced 1.1822/1.1996 corrective upleg.

Stronger dollar, driven by rising US 10-y yields which hit the highest level in seven years, keep the single currency under strong pressure and risk continuation of downtrend from 1.2413 (17 Apr high).

Firm break below 1.18 handle would open 1.1717 (12 Dec trough) and more significant supports at 1.1709 (Fibo 38.2% of 1.0340/1.2555 ascend) and 1.1675 (weekly cloud top).

Bearish techs support the notion as converging 20 and 200SMA’s are about to form bear-cross and reinforce negative stance.

Base of thick 4-hr cloud at 1.1884 and falling 10SMA at 1.1904 mark solid barriers which should cap stronger upticks.

German CPI came out in line with expectations and focus turns towards EU inflation data which are forecasted unchanged from previous month (Apr CPI y/y 1.2% f/c vs 1.2% prev, Core 0.7% f/c vs 0.7% prev).

Res: 1.1858, 1.1884, 1.1904, 1.1938
Sup: 1.1815, 1.1776, 1.1717, 1.1709

EUR/USD

Current level - 1.1837

The consolidation pattern above 1.1820 should be considered complete and the outlook is bearish, for a slide towards 1.1720. Minor intraday  resistance lies at 1.1870, followed by the crucial 1.1910.

USD/JPY

Current level - 110.25

The break through 110.02 peak signals, that the general upmove has been renewed, targeting 111.00, en route to 111.90 area. Initial intraday support lies at 110.00 and crucial on the senior frames is 109.15 low.

GBP/USD

Current level - 1.3509

My outlook is bearish below 1.3525 minor resistance, for a further depreciation towards 1.3300 zone.

XAUUSD (1294.57): Gold prices fell strongly on the day as price action breached past the 1300 level of support. The decline below this level could suggest a near term consolidation with further losses likely to push gold prices lower toward the 1250 level of support which remains the next target. To the upside, any corrective rallies could potentially stall near the 1311 - 1307 level of resistance.

GBPUSD (1.3502): The British pound eased below the 1.3530 level of support yesterday as the currency fell on the jobs report release. Still, we expect to see the consolidation continuing at this price level. A near term rebound back to 1.3530 could signal a brief retest of this level. If price action turns weaker at this level, we could expect to see the losses falling lower toward the 1.3500 level of support. To the upside, the bias can only shift on a strong close above the 1.3530 level.

EURUSD (1.1833): The EURUSD extended losses strongly on the day as price action fell to the previous lows below 1.1832. The retest of this level near could potentially signal a rebound in prices but price action is likely to stall back near the resistance level. A breakout above the resistance level of 1.1960 1.1920 could confirm the upside bias. In the near term, if the resistance holds, then EURUSD could be seen pushing lower to test the next support level 1.1730.

The markets were trading mixed amid a day that saw weaker economic reports from the Eurozone and a slightly upbeat jobs report from the UK. The U.S. dollar gained strength late in the day as the currency surged on rising yields.

The UK's monthly jobs report showed that real wages were finally starting to grow. Average earnings excluding bonuses rose at a pace of 2.9% in the first quarter of the month as the UK's unemployment rate held steady at 4.2%, unchanged from the month before. The employment rate also increased to 75.6%.

Data from the Eurozone was somewhat subdued. Germany's first quarter GDP growth was seen rising at a pace of just 0.3% compared to the 0.7% increase seen in the previous quarter. The Eurozone's second revised GDP estimate was unchanged at 0.4%.

Looking ahead, the economic calendar for the day will see the release of the final inflation figures from the Eurozone. Economists forecast that the headline CPI increased 1.2% on the year in April while core CPI is forecast to rise at a slower pace of 0.7% on the year. The ECB President Mario Draghi is expected to speak later in the day.

Data from the U.S. will see the release of the monthly building permits data while Canada's manufacturing sales is expected as well. Later in the evening, the SNB Chairman, Thomas Jordan is expected to speak.

The euro currency has fallen to a fresh monthly trading-low against the US dollar, hitting 1.1815, as the greenback gained broadly on Tuesday. The EURUSD pair currently trades around the 1.1830 level, and remains under heavy selling pressure after yesterday’s bearish move below the key 1.1900 level. Traders continue to look for EURUSD weakness below the key 1.1800 level, as they await the release of key eurozone Inflation data.

The EURUSD pair is medium-term bearish while trading below the 1.1870 level, further losses towards 1.1815 and 1.1770 seems possible.

If the EURUSD pair moves above the 1.1870 level, we may see a correction back towards the 1.1900 and 1.1937 resistance levels.

The US dollar finally broke above the key 110.03 resistance level, as US 10-year treasury-yields soared to a seven-year trading high on Tuesday. The USDJPY pair currently trades around the 110.25 level, after finding interim technical resistance from the 110.48 level. Traders continue to watch the greenback and US bond yields for a directional bias, with the 93.00 level now key support on the US dollar index.

The USDJPY pair is medium-term bullish while trading above the 110.03 level, key intraday technical resistance is located at the 110.48 and 111.00 levels.

If the USDJPY trades below the 110.03 level, the pair may fall towards the 109.80 and 109.39 support levels.

Bitcoin extends its losses to reach a weekly low of $8020 – the lowest level since mid-April. The decline follows weeks of gains caused by excitement that American buyers would invest in bitcoin after the US tax season came to an end.

Today's decline comes as the crypto industry holds one of its biggest events in New York. Consensus 2018 –a three-day conference which features a wide range of cryptocurrency talks and exhibitions – recorded its biggest attendance in history with more than 4000 people paying the $2000 entry fee. Attendees included James Bullard, the President and CEO of St. Louis Fed and Jeremy Alliare, the CEO of Circle.

One of the biggest announcements at the event came from Circle who revealed plans to launch a new fiat-backed currency pegged on the dollar. The stable ‘US dollar coin' could be a game changer in the blockchain industry helping to solve the problem of volatility. This is currently one of the biggest crypto issues because businesses are afraid to accept a currency that could fall in value within minutes. Circle is currently valued at more than $3 billion.

Bitcoin is currently trading at $8145. It is trading below the 30 and 60-day moving averages with the MACD showing signs of a shorter downside. Using the hourly chart, the pair's RSI is at 30, headed higher. It is likely that the pair will continue moving lower but, traders need to be careful going short because a reversal might be on the horizon.