Intraday Market Analysis – USD Rally On Hold

August 12, 2021

USDJPY sees limited correction

A drop in July’s core CPI in the US has put the greenback on the defense.

The rebound had gained traction after the pair closed above 110.50, a major resistance on the daily chart. This is a strong sign that the rally may have resumed after a five-week-long consolidation.

Though a repeatedly overbought RSI showed overextension in the short-term, and the current pullback would test the psychological level of 110.00.

Then 111.20 would be the next stop if the bullish momentum picks up again.

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AUDUSD tests key resistance

The Australian dollar hit resistance after worse-than-expected consumer inflation expectations.

The pair is still under pressure after it met stiff selling pressure at the 20-day moving average (0.7400).

The drop below the key support at 0.7330 may have threatened the chance of a sustainable rebound. Only a bullish close above 0.7400 would bring back confidence to the bulls.

Otherwise, past 0.7320 the bears would challenge the floor at 0.7290. A breakout could trigger an extended sell-off as those who bought the dip switch side.

US OIL attempts rebound

WTI crude recouped losses after the US inventory showed a deficit last week.

Strong buying interest on the daily support line at 65.30 has initiated a rebound. However, a bearish MA cross on the daily chart may have tempered the bullish mood.

The bulls will need to lift the psychological level of 70.00 as a show of strength. Then they may have a chance to grind past 74 and preserve the rally.

Failing that, a break below the said support may trigger a bearish reversal towards last May’s low at 61.50.

By Orbex