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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 and AUD/USD

The dollar is strengthening sharply against many of the majors, with EUR/USD, GBP/USD and AUD/USD all following that trend. However, with the possibility of a bullish announcement from the US and China, there is a better chance of an AUD rebound than its European peers.

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EUR/USD turning lower from Bollinger resistance

EUR/USD is moving lower once again, following on from a rally into Bollinger resistance yesterday. The ability to break below $1.1715 would point towards a continuation of the short-term downtrend in play.

Given the break below the 76.4% retracement support level, there is a strong chance that this period of weakness will persist for a move towards the critical $1.1554 support level. Watch for a break above $1.20 to negate the short-term bearish outlook.

GBP/USD heading into Fibonacci support

GBP/USD is similarly heading lower, as a dollar strength story continues to dominate the FX space. The weakness we are continuing to see in play here is an extension of a double top formation completed three weeks ago.

To the downside, watch out for the 76.4% Fibonacci support level at $1.3354. However, as long as we continue to create lower highs and lows on an intraday basis, a bearish outlook remains in play. As such, watch for a break above $1.3492 as a signal that this short-term downtrend is coming under pressure.

AUD/USD pullback looks like potential retracement

AUD/USD has been turning lower since US President Donald Trump threw doubt over the presumption that recent statements from the US and China marked the end of trade war fears. The subsequent pullback could be a retracement given the recent gains seen of late.

However, with the price currently at the 50% level, there is a good chance of further downside in the near term. However, until we break below $0.7447 this period of downside looks like a retracement before we see the price turn higher once more. As such, look out for possible buying opportunities at the 61.8% and 76.4% levels.

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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