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

NFP day dawns, promising plenty of excitement in FX markets.  

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 sterling coin and dollar note
Source: Bloomberg

GBP/USD bears bitten by spike

Sterling bears will be licking their wounds today after yesterday’s spike. We have seen the price drift back from $1.33, which marked the limit of cable’s advance. A break through here would head towards $1.3370, the high from the beginning of August.

Any strength in the dollar following non-farm payrolls today could see some of the gains unwound, with initial support around the 50-hour simple moving average (SMA) at $1.3197, and then down to the lows of the week around $1.3050.

EUR/USD bounces into ceiling

The pair bounced yesterday and hit a ceiling at $1.12, providing, it seems, another selling opportunity.

Further downward progress would head towards the lows of the week around $1.1125, and through here the next target would be the early August low at $1.1069.

Any rally through the 200-hour SMA ($1.1225) might start to put a dent in the bearish outlook, with $1.13 as longer-term resistance.

USD/JPY tests 2016 downtrend

The 2016 downtrend is being tested once again, with IN_USDJPY trying to succeed where yesterday’s rally to ¥104 failed. If it does push through ¥104, then the next target would be ¥106.

So long as daily stochastics remain in a bullish trend, with the hourly moving averages all moving higher, then the instinct heading into next week will be to buy dips as they appear. 

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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.