CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure. CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure.

Dollar strength sends EUR/USD and GBP/USD lower, while USD/JPY pushes higher

Dollar strength has helped to drive EUR/USD and GBP/USD lower, while USD/JPY has surged into a fresh 15-month high.

EUR/USD to continue its decline after breaking key support

EUR/USD has managed to break below the critical $1.1847 support level this morning, bringing a fresh lower low to maintain the bearish trajectory seen over the course of June. That points towards a bearish continuation from here, with further weakness likely to take shape.

A breakup through the $1.1884 level would bring about a more neutral outlook, raising the likeliness of a upwards retracement phase. However, we would ultimately require a push through the $1.1975 level to bring an end to the ongoing bearish outlook.

GBP/USD on the slide after hitting fresh two-month lows

GBP/USD has continued its downward trajectory, with the decline through $1.3786 bringing about a new two-month low for the pair. Dovish comments from Andrew Bailey reiterated the divergence in outlook between the Federal Reserve (Fed) and the Bank of England (BoE), raising the likeliness of further weakness.

With that in mind, another move lower looks likely before long, with any short-term gains expected to represent a retracement phase. In particular, a rise through $1.3873 would bring a deeper retracement phase, while a push through $1.40 would be required to bring an end to this month-long downtrend.

USD/JPY spike starts to ease

USD/JPY ended its retracement phase relatively early this week, with the price pushing sharply higher at the 50% retracement level. The push up through the trendline resistance does raise the chances of an exit into a phase that is more one-dimensional in terms of its bullish trajectory.

Nonetheless, we still remain at risk of another retracement given the way that things have shaped up over the past month. With that in mind, a break below the ¥80.00 threshold on the stochastic could bring a potential signal that momentum is swinging back in favour of a bearish retracement phase. In any case, a wider bearish outlook holds unless the price falls back below the ¥110.41.

Read more: see the biggest 2021 IPOs, and get details on the upcoming Seraphim Space Investment Trust IPO and Robinhood listing.

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.

Start trading forex today

Find opportunity on the world’s most-traded – and most-volatile – financial market

  • Trade spreads from just 0.6 points on EUR/USD
  • Analyse with clear, fast charts
  • Speculate wherever you are with our intuitive mobile apps

See an FX opportunity?

Try a risk-free trade in your demo account, and see whether you’re onto something.

  • Log in to your demo
  • Try a risk-free trade
  • See whether your hunch pays off

See an FX opportunity?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Get spreads from just 0.6 points on popular pairs
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See an FX opportunity?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Friday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.