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 weaken as USD/JPY bounce gathers pace

Dollar strength has lifted USD/JPY, whose rally has entered a third day, but EUR/USD and GBP/USD are retreating.

EUR/USD moves lower

EUR/USD managed to break out of a short-term descending channel at the end of last week, but gains stalled yesterday below $1.19.

If the buyers are to really reassert control then a move above $1.19 and then $1.196 would be required, clearing the way for a bigger move to the upside. Sellers will hope that the price will turn back lower and target last week’s lows near $1.175.

GBP/USD falters at $1.39

With GBP/USD having recovered to an extent, and continuing to hold the $1.375 area, the price now looks for a move back towards $1.40.

Friday’s bounce was a powerful thrust, and dealt a blow to the bearish view. While there wasn’t much movement yesterday at least it held its ground, providing a base for further gains.

USD/JPY bounce enters a third day

Five days of losses with USD/JPY brought the price back to the 50-day simple moving average (SMA) currently ¥109.85, where a defence was mounted and a new bounce appears to have begun.

Further gains target the peak from the beginning of the month, towards ¥111.57. A renewed bearish view requires a move back below last week’s higher low and then below ¥109.55.

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.

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