USD/JPY grinds rising trend line
The Japanese yen dipped after the CPI in the Tokyo area fell short of expectations in June. The pair has been climbing along a rising trend line from mid-June and the bullish mood means that pullbacks have been opportunities for the buy side to stake in. The greenback is testing the supply zone around 146.00 from last November’s sell-off. A bullish breakout would cement the dollar’s supremacy and pave the way for a rally towards 150.00. On the downside, 144.00 on the trend line is the first support.
GBP/USD breaks lower
Cable slips as traders fear the UK economy is the weakest link in the global tightening campaign. A fall below 1.2650 was a sign of profit-taking after the bulls struggled to push back above 1.2830, putting a dent to the short-term mood. However, Sterling still has an edge from the daily chart’s perspective. 1.2650 at the confluence of the base of a mid-June breakout rally and the 30-day SMA is a key level to expect buying. The brief support-turned-resistance of 1.2710 is the level to lift before cable could resume its uptrend.
FTSE 100 struggles for bids
The FTSE 100 slides as the Thames Water crisis pulls utility stocks lower. A slip below the previous swing low of 7430 has put the bulls on the defensive, giving back most of the gains from the V-shaped bounce in May. The latest uptick came under pressure at 7515 as trapped bulls ran for the exit. However, its breach could extend the recovery to 7580 which coincides with dynamic resistance from the 30-day SMA. On the flip side, 7430 is the bulls’ last chance to prevent a correction all the way to this year’s lows near 7300.
