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

Further gains for sterling look tricky, while a dovish set of RBA minutes has put pressure on the Aussie. 

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.
Euro notes
Source: Bloomberg

GBP/USD

Yesterday saw some recovery for cable from Friday’s sell-off, but overall bullish momentum was absent. Today’s CPI number could provide a catalyst, with a push through Monday’s high near $1.33 opening the way to a test of the Friday peak at $1.3450.

Further downside momentum would potentially find support at $1.3150 and then $1.31, while over the longer-term $1.2850 is the area to watch.

EUR/USD

The relatively narrow trading range persists here, with an ongoing recovery from Friday’s low near $1.1020 stalling below $1.1080. The pair needs to break higher today to be in with a chance of testing the $1.1140-$1.1160 area where gains have stalled since late June.

Downside moves might find support around $1.10, the key low of the past three weeks, with a longer-term view suggesting a close below $1.10 would then see the pair test the March lows at $1.08. 

AUD/USD

The market seems to have taken the Reserve Bank of Australia minutes in a fairly negative way, pushing the currency back to its lowest level against the US dollar since 8 July. The $0.7460 level is the next area to watch on the downside, with a move through here heading towards the 27 June low at $0.7330.

A move above $0.76 would be needed to reverse the bearish outlook here for AUD/USD.

USD/JPY

The rally here shows no sign of stopping yet, although given the longer-term view it still looks sensible to sell into strength. So far we have yet to see a push through the highs of Friday and Monday, around ¥106.35, and even if this occurs we still have the downtrend line off the February highs, which would likely come into play around ¥107.

Downside support is possible around ¥104.50 and then ¥104, with a bigger move raising the prospect of a test of ¥102.50 and then ¥100.

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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.

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