INTRADAY TECHNICAL ANALYSIS 25 MAY (observation as of 05:10 UTC)

[EURUSD]

Important Levels to Watch for:

-        Resistance line of 1.22409 and 1.22626.

-        Support line of 1.21704 and 1.21486.

Commentary/ Reason:

  1. The euro was up 0.13% on Tuesday at $1.22294 as the lower T-note yields pressured the dollar.

  2. The pair gains moderately on optimism that the Eurozone economy will gather strength as a faster pace of vaccinations allows more pandemic restrictions to be lifted.  Germany on Monday reported 62.5 new COVID-19 infections per 100,000 people over the past week, the lowest rate since late February. 

  3. The dollar was weighted by the softer-than-expected U.S. data and fresh insistence from Fed officials that policy would stay on hold allayed investor fears about inflation forcing interest rates higher.

  4. The EUR/USD is once again making moves towards the 1.224 ceiling. Bullish moves in the last two trading session suggest buyers have been reinvigorated, though unable to break the resistance line. At the very least, the current trading range is likely to remain intact. Momentum indicators remain bullish.

EURUSD

 

[USDCHF]

Important Levels to Watch for:

-        Resistance line of 0.90067 and 0.90267.

-        Support line of 0.89418 and 0.89217.

Commentary/ Reason:

  1. The dollar eased to 0.89612, down 0.07% against the Swiss franc on Tuesday, lingering not far from its more than 3-month low of 0.89535 recorded Friday.

  2. The greenback was weighted in recent belief that low U.S. rates will drive cash abroad as the world recovers from the pandemic. They have become leery of adding to positions after an April leap in inflation cast doubt on the policy outlook, though seemed to find reassurance in data and Fed remarks overnight.

USDCHF

 

[GBPUSD]

Important Levels to Watch for:

-        Resistance line of 1.41840 and 1.42077.

-        Support line of 1.41074 and 1.40837.

Commentary/ Reason:

  1. The British pound stood at $1.41792, rose 0.17% on Tuesday.

  2. Sterling is perched higher on Boris Johnson’s plan to unlock the UK economy appears on track after data showing COVID-19 vaccines are effective against a worrying variant boosted the government’s confidence in its proposed roadmap.

  3. The lower 10-year T-note yield for two consecutive day also helped the pound to climb higher against the dollar.

GBPUSD