Six Major Currencies Weekly Technical Analysis: USD/JPY Eyes Key Resistance at 110

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The past week saw a mixed performance in the forex markets despite relatively strong U.S. economic data. While first-quarter GDP was slightly revised downward, core PCE inflation came in line with expectations, and the nonfarm payrolls report exceeded forecasts—factors that typically support the U.S. dollar—the greenback reversed course after an initial rally. This shift suggests the dollar’s nearly six-week bullish run may be entering a correction phase. Technically, the dollar index has broken below its April-starting uptrend line, and repeated failed attempts at recovery signal further downside potential in the near term.

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EUR/USD: Upside Momentum Builds After Breakout

EUR/USD dipped close to the 1.1500 level last week—the confluence of the 2015–2016 consolidation zone top and the long-term rising trendline from 2016’s lows. This historically strong support triggered a sharp rebound, limiting weekly losses. The most significant development was the breakout above the bearish trendline extending from April 19, which increases the likelihood of continued bullish momentum in the coming days.

Traders should watch key resistance levels at 1.1730, 1.1750, and 1.1800 if the rally extends. On the downside, immediate support lies at 1.1670, followed by 1.1650 and 1.1630—a cluster of technical supports. A decisive close below 1.1630 would shift the bias back to bearish, potentially reopening the door toward retesting the 1.1500 zone.

This pair is now at a technical inflection point. The combination of structural support and trendline breakout makes EUR/USD one of the most watchable pairs this week.

Frequently Asked Questions (FAQ)

Q: Why is 1.1500 such a strong support level for EUR/USD?
A: The 1.1500 area aligns with both multi-year price consolidation highs and a long-term rising trendline dating back to 2016, making it a high-probability support zone based on historical price behavior.

Q: What does breaking above the April 19 trendline mean for EUR/USD?
A: Breaking above a well-established downtrend line suggests weakening bearish control and increases the odds of short-term bullish continuation, especially when confirmed by momentum.

Q: What would confirm a bearish reversal despite recent gains?
A: A daily close below 1.1630 would invalidate the recent bullish structure and suggest sellers are regaining control, possibly leading to renewed declines.

Gold/USD: Balanced Risks Amid Range-Bound Action

Gold ended the week slightly lower but remains trapped in a narrow range. The metal continues to trade within a descending channel since April’s highs and remains below the Bollinger Band® midline, indicating persistent bearish pressure on higher timeframes.

However, there's a counterbalance: the long-term rising trendline from 2016 has held firm for two consecutive weeks. This dual setup creates a standoff between bulls and bears—making direction unclear in the short term.

On the downside, 1290 is the immediate support. A confirmed break could open the path toward 1280, with further downside risk beyond that level. Conversely, upside attempts will face resistance at 1298–1300. A sustained move above 1300 could trigger short-covering and lift prices toward 1308, especially if momentum indicators turn positive.

Until a clear breakout occurs, gold traders should prepare for choppy, range-bound conditions.

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USD/JPY: Critical Battle at 110 Resistance

USD/JPY saw dramatic swings last week—plunging toward 108.00 before staging a strong recovery to close near 109.50. Despite this rebound, the pair remains under bearish pressure as long as it trades below the major confluence resistance at 110.00, where the 200-day moving average meets the long-term downward trendline from 2017.

Failure to clear 110 keeps the outlook neutral-to-bearish. In that case, downside targets include 109.30, 109.00, and 108.50. However, a confirmed breakout above 110 would be a game-changer—flipping sentiment to bullish and opening the path toward 110.80 and eventually the May high at 111.40.

Market participants should monitor U.S.-Japan yield spreads and risk sentiment closely, as they heavily influence this pair.

Frequently Asked Questions (FAQ)

Q: Why is 110 such a key level for USD/JPY?
A: It's not just psychological—the 110 zone combines technical resistance (200-day MA + multi-year trendline) with institutional order flow concentration, making it a pivotal decision point.

Q: How do bond yields affect USD/JPY?
A: Rising U.S. Treasury yields tend to boost USD/JPY by widening yield differentials, while falling yields or safe-haven demand for JPY can pressure the pair lower.

Q: What confirms a bullish reversal in USD/JPY?
A: A daily close above 110 accompanied by rising volume and positive momentum divergence would be strong confirmation of a trend shift.

GBP/USD: Struggling to Break Bearish Grip Below 1.34

GBP/USD showed minor strength last week with a small upward close after finding support near recent lows. While short-term bounce potential exists, the broader picture remains constrained by resistance at 1.3400.

A confirmed break above 1.3400 could accelerate gains toward 1.3460 and 1.3500, offering relief to bulls. But without that breakout, the pair remains vulnerable to renewed selling pressure. Downside risks include a return to 1.3300 and possibly 1.3200, especially if broader dollar strength returns.

The lack of strong fundamental catalysts leaves technical levels as primary drivers this week.

AUD/USD: Bullish Case Hinges on Key Resistance Break

AUD/USD continues to show resilience, bouncing strongly from 0.7500 support last week and breaking through 0.7560 early this week. However, to confirm a true bullish shift, it must overcome two major obstacles:

A sustained move above this 0.7650–0.7680 resistance zone would validate a structural upside breakout and could propel the pair higher with improved momentum.

Conversely, failure at this zone may lead to profit-taking and a resumption of downtrend dynamics, potentially dragging prices back toward 0.7500 or lower.

Commodity prices and Chinese economic data will remain key external influences on AUD performance.

USD/CHF: Bearish Break Confirmed After Trendline Violation

USD/CHF posted its third consecutive weekly decline and has now decisively broken below the upward trendline dating back to February—a development that shifts the technical bias to bearish.

Further downside could target 0.9830, then 0.9800. A close below 0.98 would likely accelerate losses, potentially extending toward 0.9700 as bears take control.

On the upside, any recovery will face stiff resistance near 0.9900, where previous support now acts as resistance. Only a reclaim of this level would suggest a reversal of bearish momentum.

Given CHF’s safe-haven status, risk-off market environments could continue pressuring USD/CHF lower.

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Frequently Asked Questions (FAQ)

Q: What does breaking below a trendline mean for USD/CHF?
A: It signals weakening bullish momentum and increases the probability of further downside, especially when confirmed over multiple sessions.

Q: Why is 0.9800 important for USD/CHF?
A: It's a psychological level and former support area; breaking it could trigger algorithmic selling and stop-loss orders below.

Q: Can USD/CHF rebound without breaking 0.99?
A: Temporary bounces are possible, but without clearing 0.99, any rally lacks conviction and is likely to fail.

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