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Zloty, Forint Technical Divergence Highlighted as PLN Outperforms CE3 Peers

CEE FX
CE3 currencies have seen most, if not all, of their post-Fed gains eroded throughout Thursday trade due to the sustained recovery in the greenback. Higher US yields have underpinned the move, exacerbated by the strong US PMI figures. Accordingly, HUF and CZK have struggled alongside much of the EM basket, though PLN is a notable outperformer in the region, with the more bullish outlook for the zloty potentially accounting for its resilience.
  • Trend conditions in EURHUF remain bullish and the latest pullback is considered corrective. Fresh trend highs maintain the bullish price sequence of higher highs and higher lows, signalling scope for an extension towards the 400.00 handle and key resistance at 402.45, the Mar 20 2023 high. Initial firm support lies at 393.43, the 20-day EMA – a level tested but yet to be clearly broken.
  • On the other hand, EURPLN trend conditions are unchanged, the outlook remains bearish and last week’s sell-off reinforces this set-up. The cross cleared key support and the bear trigger at 4.2935, the Dec 13 low. This confirms a resumption of the downtrend that started in September last year and opens 4.2371, the Feb 14 2020 low. Initial firm resistance is seen at 4.3256, the 50-day EMA.
  • For EURCZK, bulls will eye a stronger rebound above the Feb 15 high of 25.519. On the downside, bears will look for a dip through the 50-DMA which provided firm support on Monday this week and back in January. That average intersects today at 25.125. A break could expose 25.000.
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CE3 currencies have seen most, if not all, of their post-Fed gains eroded throughout Thursday trade due to the sustained recovery in the greenback. Higher US yields have underpinned the move, exacerbated by the strong US PMI figures. Accordingly, HUF and CZK have struggled alongside much of the EM basket, though PLN is a notable outperformer in the region, with the more bullish outlook for the zloty potentially accounting for its resilience.
  • Trend conditions in EURHUF remain bullish and the latest pullback is considered corrective. Fresh trend highs maintain the bullish price sequence of higher highs and higher lows, signalling scope for an extension towards the 400.00 handle and key resistance at 402.45, the Mar 20 2023 high. Initial firm support lies at 393.43, the 20-day EMA – a level tested but yet to be clearly broken.
  • On the other hand, EURPLN trend conditions are unchanged, the outlook remains bearish and last week’s sell-off reinforces this set-up. The cross cleared key support and the bear trigger at 4.2935, the Dec 13 low. This confirms a resumption of the downtrend that started in September last year and opens 4.2371, the Feb 14 2020 low. Initial firm resistance is seen at 4.3256, the 50-day EMA.
  • For EURCZK, bulls will eye a stronger rebound above the Feb 15 high of 25.519. On the downside, bears will look for a dip through the 50-DMA which provided firm support on Monday this week and back in January. That average intersects today at 25.125. A break could expose 25.000.