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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

​​EUR/USD and GBP/USD fall back while USD/JPY edges higher​

​​Caution in early trading has seen the dollar move higher, pushing down EUR/USD and GBP/USD while lifting USD/JPY.​

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​​​EUR/USD slips to three week low

​Despite a weaker US consumer price index (CPI) reading that might have been expected to weaken the dollar, EUR/USD proved unable to move higher and remained stuck below $1.10.

Recent weeks have seen the $1.095 area hold as support, so a break below this might open the path to the 50-day simple moving average (SMA), or trendline support from the September-low. A break below this latter support would likely be regarded as short-term bearish, though the medium-term trend remains intact.

​A revival above $1.10 could signal another attempt to move on above $1.11 and to new highs for the year.

EUR/USD chart Source: ProRealTime
EUR/USD chart Source: ProRealTime

​GBP/USD weakens ahead of BoE decision

​The GBP/USD pair pushed to its highest level in over a year on Wednesday, briefly moving above the late May 2022 high.

​Pre-Bank of England (BoE) nerves held back any sustained upside however, though there was no sign of any real downside in the short term. The price has enjoyed a strong rally since April, after some sideways consolidation in March.

​For the moment, the bullish view is firmly in place, and it would need a move back below $1.24 to suggest a deeper retracement is at hand in the short term.

GBP/USD chart Source: ProRealTime
GBP/USD chart Source: ProRealTime

​USD/JPY stabilises after losses

​Wednesday’s lower CPI figure prompted a reversal in the pair USD/JPY that has dented the uptrend of the past two months.

​A test of trendline support from the January lows may result if the rest of the week sees further losses. A drop below ¥132.80 would mark a more bearish development and open the way to ¥130.00.

​Buyers will need a move back above ¥134.30 to reverse this outlook and suggest another move back to the 200-day SMA could be in the offing.

USD/JPY chart Source: ProRealTime
USD/JPY chart Source: ProRealTime

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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