EUR/USD keeps on consolidating in the $1.1350/1250 range, forming a small horizontal triangle. The medium-term EUR/USD prospects remain gloomy. From the technical viewpoint, euro approached the upper border of the bearish channel ($1.1350) – this is where the first significant resistance lies. Next level to watch - $1.1420 (Jan. 27 high). Selling euro on rallies seems to be the best strategy. On Tuesday euro zone will release Spanish unemployment data. Number of unemployed people is expected to have fallen in January, but less than in December. Pay attention to the news from Greece – these days the new government is trying to soften the credit conditions.
AUD/USD tried to recover above the $0.7800 mark on Monday, but remains in a clear bearish channel. On Tuesday Australia is scheduled to release trade data and building approvals. The Reserve Bank of Australia (RBA) meeting will be in focus – we can’t exclude a new rate cut. In this case the $0.7710 support will likely be broken. Next medium-term bearish target lies at $0.7000. However, note that the pair is oversold and approached the channel support line: in absence of dovish news from RBA the bullish recovery could extend towards $0.7900 and $0.8300.
USD/JPY remains in the triangle, formed in December 2014. On Monday the pair tested the 117 yen mark, but failed to sustain the downside. Next resistance lies at 118.30. This week the Japanese agenda is light, so the pair will mostly be driven by the US data.
GBP/USD resumed the decline on Monday, approaching the $1.5000 mark. Strong manufacturing PMI data failed to support the pound. On Tuesday US is scheduled to release construction PMI (forecast – downbeat). Fix below $1.5000 will open the way to $1.4815. Resistance - $1.5030/50 and $1.5010.