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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, USD/JPY

Dollar weakness continues to be the rule, with USD/JPY under pressure once again.

Euro and dollar
Source: Bloomberg

EUR/USD in a comfortable uptrend

Weakness for EUR/USD is short-lived, as the push above $1.17 is confirmed. The near-term areas to watch are $1.1650 and then $1.1616, with no end in sight to the ‘buy on the dips’ approach here.

A close below $1.1470 is needed to put a dent in the overwhelming uptrend here.

GBP/USD holding on to $1.31

GBP/USD continues to cling on to $1.31, with the recovery back above $1.30 suggesting that further gains are likely and may result in a challenge of the $1.34 area, not seen since September last year.

The rising 100-day simple moving average (SMA), currently at $1.2786, would provide a good test of the trend, with a bounce off this level, as we saw in June, providing a potentially more attractive buying opportunity. 

USD/JPY remains bearish

Hopes of a turnaround for USD/JPY were dashed last week, with a push to the 200-day SMA (¥112.18) bringing out the sellers.

A drop below ¥110 would then raise the prospect of a dip to ¥109 and ¥108. A close above the 200-day SMA is needed to negate the bearish view.  

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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