EURUSD and GBPUSD: EURUSD is testing the EMA50 at 1.05600

• Pair EURUSD was in bullish consolidation this week from 1.05200 to 1.06200 level.
• During the Asian trading session, GBPUSD struggled to maintain the 1.21400 level.

EURUSD chart analysis

Pair EURUSD was in bullish consolidation this week from 1.05200 to 1.06200 level. We hit that level yesterday during Powell’s US monetary policy speech. There, the euro encounters resistance and retreats below the 1.05800 level. During the Asian session, the pair breaks below and forms a daily low at 1.05650. We could expect the EURUSD to drop to the 1.06000 level and test the support in the EMA50 moving average there.

The EURUSD breakout below would signal a further decline and a visit to the previous support zone of 1.05200-1.05300. We need a positive consolidation and a return above the 1.05900 level for a bullish option. Then, we need to stop there so that we can start further recovery with a new impulse. Potential higher targets are 1.06000 and 1.06100 levels.

GBPUSD chart analysis

During the Asian trading session, GBPUSD struggled to maintain the 1.21400 level. It failed to do so, and there was a breakout below and a pullback to support at the 1.21000 level. Yesterday, we were also once in that zone, forming a  weekly low at the 1.20899 level. Now, we are very close to testing that level again. Increased bearish pressure could influence us to see a breakout below the formation of this week’s new low. Potential lower targets are 1.20800 and 1.20600 levels.

For a bullish option, we need a positive consolidation and a jump of GBPUSD above the 1.21500 level. Then we would have to hold up there if we want to see a continuation to the bullish side. Potential higher targets are 1.21600 and 1.21800 levels. Additional resistance in the zone around 1.21800 is the EMA50 moving average.