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

With EUR/USD and USD/JPY both hitting Fibonacci resistance, coupled with a GBP/USD break higher, could we be seeing reversal across the board?

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.
Pound and dollar
Source: Bloomberg

EUR/USD hits key Fibonacci resistance

EUR/USD has finally reached the 76.4% retracement of the referendum day devaluation. This is the area of retracement we have been looking for as a potential reversal point for this market. Essentially, getting short here is a play on the long-term downtrend evident within the pair.

Essentially, while we have not seen any reversal signals yet, a 3:1 trade for a break back to $1.0952 rather than above $1.1428 would make sense given the wider trend. 

We would need an hourly close above $1.1428 to negate this bearish view.

GBP/USD rallies through key level

IN_GBPUSD rallied through the $1.3034 level yesterday, providing us with a new higher high on an intraday basis. This points towards a potential strengthening for the pair over the short-term. Certainly we are looking at a highly overbought market which could reverse lower for a retracement before moving higher. However, it does look like we could ultimately move higher soon.

An hourly close above $1.3071 would provide greater confidence that we are going to move into a more bullish short-term phase, with $1.3094 and $1.3175 the next resistance levels. 

USD/JPY turns lower following retracement

IN_USDJPY is selling off following a sharp appreciation into the 76.4% retracement over the past 24 hours. Coming off the back of a clear downtrend, it makes sense that we will see another leg lower, with greater confidence coming with a push below ¥100.48.

Essentially, a bearish view remains in place unless price breaks and closes back above ¥101.46.

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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.