Dollar slightly firmer in European morning trade so far

Technical Analysis

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The greenback keeps steadier after the decline yesterday but nothing that really stands out all too much

EUR/USD touched a high of 1.2088 earlier before retreating amid a decline in cable on the back of Brexit headlines, with the risk mood also more tepid on the session.

European indices are slightly softer while S&P 500 futures are down 0.2% currently.

For EUR/USD, the retreat saw the pair hit a low of 1.2046 but it doesn’t take away from the more bullish breakout from yesterday above the 1.2000 handle.

The figure level is still the defining psychological barrier at this point and as long as buyers keep a break above that, the momentum is still favouring them for now.

Meanwhile, GBP/USD fell hard from 1.3440 to a low of 1.3339 amid some Brexit pessimism but the pair is bouncing off key near-term levels and trading around 1.3360 currently as buyers are still trying to keep near-term control on the day.

The commodity currencies bloc is also little changed against the greenback although USD/CAD is continuing to track lower to 1.2920 as sellers are looking to hold a break below the 31 December 2019 low of 1.2951.

Elsewhere, USD/JPY is looking perky as it trades near session highs just above 104.60.

USD/JPY D1 02-12

The push higher in Treasury yields overnight is underpinning yen crosses in general and that is contributing to the move we are seeing in USD/JPY as well:

USGG10YR

In the bigger picture though, USD/JPY is still trapped within a downwards channel with key resistance seen closer to 105.00 as well as the 100-day moving average @ 105.41.

That will be the key levels to watch in case buyers do try to exert any further upside pressure in the pair towards the year-end.

Besides that, one of the more notable move in yen pairs today is AUD/JPY:

AUD/JPY D1 02-12
The pair is trading to its highest levels since mid-September and is looking to keep a break above the 77.00 handle – which has limited gains since last month.
A firm break above that paves the way for a potential push towards the year’s highs around 78.36-46 and this also acts as a risk barometer for the market in general.
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