Skip to content

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 – GBP/USD, EUR/USD, USD/JPY

It looks like the dollar is recovering its strength, which suggests a turn may be at hand for cable and eurodollar. 

Dollar and yen notes
Source: Bloomberg

GBP/USD rally looks like it may be at an end

The rally in cable from the 16 January lows may be at an end, with the price failing to get back above $1.26 over the past twelve hours. Bulls need to recover this level and then push on above $1.2660.

A weaker close below $1.25 today would raise the prospect that further losses lie ahead. Initial support is possible at $1.2426 and then down to $1.2250.

EUR/USD may be unwinding its rally

Heavy losses for EUR/USD yesterday raise the prospect the rally off the December lows is beginning to unwind. The close below $1.07 and below the 200-hour simple moving average ($1.0669) suggests we will see further selling, perhaps to $1.06.

It will be important to watch whether a rally in the next couple of sessions fails to break $1.07 and is met with further selling.

USD/JPY upward move looks to be intact

The pair has moved steadily higher over the past week, recovering the ¥115 level. Having moved 200 points higher in around 24 hours some weakness is to be expected, but so long as the ¥113.88 area holds then the upward move remains intact.

A break above the 19/20 January high at ¥115.64 would open the way to ¥117 and ¥119. 

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.

Find articles by writer