The safe haven US Dollar has recently lost momentum against major currency pairs as fundamentals continue to weigh on risk appetite.

After breaking above the key psychological level of 90.00 in June, the US Dollar Currency Index (DXY) has proven to be on a strong upward trajectory.

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However, as illustrated on the monthly chart below, this month’s red candle may be an indication that further downside may be on the cards unless bulls can reclaim the systemic, prominent trend.

US Dollar Currency Index (DXY) Monthly Chart

Chart prepared by Tammy Da Costa using TradingView

With prices now resting below the 50% retracement level of the 2001 – 2008 move at 95.843, this level will likely continue to hold as strong resistance for both the short and medium-term move (USD).

EUR/USD Technical Analysis

EUR/USD price action has currently stalled at the 200 day moving average, coinciding with the 50% retracement of the 2018 – 2020 move.

With prices now hovering just below 1.160 on the weekly time-frame, the combination of rising inflation and soaring commodity prices may provide an additional catalyst for the major pair over the next week.

Meanwhile, with the bearish momentum now losing traction, bears will now need to push below support at the 200 SMA at 1.157 for further downside to prevail (FXE).

EUR/USD Weekly Chart

Chart prepared by Tammy Da Costa using TradingView

USD/JPY Technical Analysis

USD/JPY has been steadily rising since breakout out of the tight range that had previously encapsulated the pair. As demonstrated on the weekly chart below, the key Fibonacci levels of the 2015 – 2016 have continued to form firm support and resistance levels for price action and will likely continue to do so for the imminent move.

At the time of writing, the safe-haven currencies continue to battle it out above critical psychological level of 114.00 with bulls now driving the weekly relative strength index (RSI) into overbought territory (above the 70 handle).

USD/JPY Weekly Chart

Chart prepared by Tammy Da Costa using IG Charts

For now, critical resistance continues to hold at the 3 year high of 114.55 with a break above this level seeing a possible test of 115 (FXY).