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.

EUR/USD and GBP/USD edge back as USD/JPY rebounds for now

Some dollar strength has lifted USD/JPY while pushing EUR/USD and GBP/USD back down.

EUR/USD recovery falters

EUR/USD's push higher has suffered a modest reverse, dropping back below the 50-day simple moving average (SMA) of $1.1803 after moving above it at the end of last week.

However, the broader rally from the lows is still intact, so we look for a recovery from an intraday higher low that will carry the price back towards Friday’s highs and then target $1.19. A bigger reversal below $1.17 would begin to suggest that a new downward move is in play.

GBP/USD steadies after strong rally

GBP/USD moved steadily higher last week and into Monday’s session, but is seeing some short-term weakness today.

However, dips over recent sessions have been buying opportunities so we look to see if today’s weakness goes the same way. Further gains target $1.32 and higher, and it will require a drop below $1.293 to breach rising trendline support from the September low.

USD/JPY edges up after losses

For the USD/JPY pair, we will see if the dollar bulls can re-establish some control after two sharp down days.

Having dropped below the 50-day SMA (¥105.78) and seen daily stochastics roll over, it will be interesting to see if the pair creates an intraday lower high and then continues to fall, perhaps testing ¥105.00 and lower.

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