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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. 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 financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

FX levels to watch – EUR/USD, GBP/USD, AUD/USD

The trend is your friend as EUR/USD and GBP/USD rallies continue, while AUD/USD maintains its descent. 

Pound and dollar notes
Source: Bloomberg

EUR/USD breaking higher towards key resistance level

EUR/USD is breaking higher from a bullish falling wedge pattern, which retraced into the 61.8% Fibonacci level. We have a clear uptrend in play throughout March so far, yet with the $1.0829 level ahead, there is a major hurdle to overcome before we can say with confidence that this rally is set to continue.

As such, watch for a four-hour close above $1.0829, which would provide a strong continuation signal as we move into next week. Alternatively, a failure to break through $1.0829 could provide a clue that this resistance level is going to become a roadblock to further gains.

GBP/USD weakness unlikely to last

GBP/USD has weakened overnight, following a period of strength over recent weeks. This appears to have provided us with a good area to get long once more, with the price failing to break back through the $1.2463 level.

The stochastic is turning higher from oversold, a signal that has provided us with bullish reversals on the past three occasions. Watch out for continued higher highs and higher lows as a signal that we are going to see further upside within this clearly bullish trend.

AUD/USD continues descent

AUD/USD is continuing to pull back, off the back of a rally into a critical resistance point of $0.7732. That resistance has been respected, with the price moving lower since.

Further losses seem likely from here, with the continued creation of lower highs and lower lows key to maintaining this short term downtrend. Two subsequent 61.8% retracements provide a clue that we could see a deeper retracement from here. However, as long as the price remains below $0.7641, then further losses look highly likely. 

This information has been prepared by IG, a trading name of IG 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. 

CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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