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

The dollar is coming under pressure this morning, with EUR/USD in particular spiking higher. However, could this move be on borrowed time?

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
Euros and dollars notes
Source: Bloomberg

EUR/USD rallies out of basing pattern
EUR/USD is rallying through the crucial $1.1230 resistance level this morning, providing us with another higher high on the four-hour chart. This provides us with a good overall perspective to show that the current resurgence looks like a retracement of the referendum downturn.

As such, with price approaching the 76.4% retracement at $1.1305, we are looking for shorts around that area to get back on the long-term downtrend. Clearly, that would mean there is a strong chance of further upside until then. We would need price to break through the $1.1428 resistance to negate that bearish view. 

GBP/USD rallies into key resistance
IN_GBPUSD is seeing a resurgence this morning, following yet another leg lower yesterday. Ultimately, there are two potential swing highs that the pair is likely to turn lower below.

Firstly, $1.2945 should hold as resistance, yet should we see an hourly close above here we would be looking for shorts again around $1.2995. We are in a clearly defined downtrend and as such, unless we see an hourly close above $1.3035, a bearish outlook remains in place.

USD/CAD downtrend to continue
USD/CAD has posted yet another sharp leg lower this morning, as the deterioration that has been in place over recent weeks continues. Clearly it is a very reliable downtrend and thus while it seems a little late to go short here, any decent sized pullback will not doubt be perceived as a good area to get short once more. 

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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.