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.
Established in 1974
Over 195,000 clients worldwide
15,000 markets worldwide

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

Both EUR/USD and USD/JPY look likely to turn lower from 76.4% resistance, while GBP/USD finds support on the same pullback.

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.
GBP/USD forex pair
Source: Bloomberg

EUR/USD turns at crucial Fib level
EUR/USD has begun to turn lower, having rallied into the 76.4% retracement yesterday. We have remained within a clearly defined downtrend throughout May so far and thus we would need to see an hourly close above $1.1243 to negate this trend.

As such, a bearish view is preferred for a move back down to $1.129 support. The stochastic oscillator and MACD histogram confirm this bearish bias, with both turning lower to match price action.

GBP/USD fails to break through key support level
GBP/USD has tried to break below a key support level this morning, in a move which would set us up for a possible period of downside for the pair. The $1.4642 level is likely to be key for today’s price action, where an hourly close below this level would likely lead to a depreciation in the pair, with $1.4601 the next support level.

Alternately, should we see this support level hold up, there is a clear uptrend in place over the past week and many will be looking to get long once more. Interestingly, the pullback seen over the past 24 hours look a lot like a retracement of Wednesday’s rally.

Thus the fact we are now seeing the pair start to rally having come within two points of the 76.4% retracement is very telling. As such, a bullish view remains unless we see an hourly close below $1.4601.

USD/JPY within triangle at Fib resistance
USD/JPY has hit trendline support once more this morning, as the pair trades within a triangle formation. This comes with a peak at the 76.4% Fibonacci pullback and as such, the bias for the eventual breakout is bearish given the multi-month downtrend in play.

Essentially it makes sense to either play the extremes of the triangle for a short-term perspective, or the eventual breakout for a bigger move. For the breakout, we will be looking for an hourly close below ¥109.11 for a bearish signal or above ¥110.66 for a bullish one.

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.