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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 – EUR/USD, GBP/USD, AUD/USD

Gains across EUR/USD, GBP/USD and AUD/USD all portray a picture of US dollar weakness. However, is this just a temporary thing before the dollar comes back into strength?

Euro and dollar notes
Source: Bloomberg

EUR/USD upside likely to be fleeting

EUR/USD has gained some ground overnight in a retracement of the weakness we saw on Monday. The pair is trading within a falling wedge pattern, yet despite the bullish connotations associated with this pattern, we would need to see a break through $1.0659 to provide a more bullish outlook.

Until then, there is a good chance that any short-term gains are fleeting, with further losses around the corner. A break below $1.0589 would be a significant signal that we are going to see further downside given that it represents a significant swing low from January.

EUR/USD price chart

GBP/USD wedge points to weakness

GBP/USD has been similarly gaining ground overnight, yet with the stochastic rolling over and price not having broken through $1.2582, it is likely we will see the pair push lower before long.

A break above $1.2582 would provide a more bullish picture but, even then, we would need the $1.2706 level to be surpassed to gain confidence of any sustained upside.

GBP/USD price chart

AUD/USD pushes into key resistance

Despite a short-term pullback yesterday, we are seeing the pair pushing into the key $0.7695 region this morning. The Australian dollar has been particularly strong of late and a move through that resistance level would provide a strong bullish breakout signal.

As such, watch out for a closed hourly candle above $0.7695 for a bullish breakout. Alternately, a break back below $0.7630 would start to look like this recent upside could begin to unravel.

AUD/USD price chart

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