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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

Dollar weakness looks set to dominate, with GBP/USD and AUD/USD expected to join EUR/USD in gaining ground.

Pound and dollar
Source: Bloomberg

EUR/USD heading higher, yet resistance awaits

EUR/USD is enjoying a blockbuster week, with pullbacks being bought into.

However, while the short-term picture remains bullish, it is worth noting that we have a massive resistance level up ahead in the form of the August 2015 high at $1.1715. A break through there would provide a new 30-month high, alongside a strong chance of a bullish range breakout on the long-term picture. A move below $1.1616 would negate the short-term bullish outlook.

GBP/USD likely to turn higher once more

GBP/USD has been pulling back over recent days, as it trades within a rising wedge pattern. So far we have seen the market turn higher from the 61.8%, which highlights the potential for a rally from here.

Another move lower would mean a likely move into the confluence of the 61.8% Fibonacci and trendline support. As such, it is likely we will soon turn higher in a continuation of the recent uptrend. We would need a break back below $1.2811 to negate this bullish outlook.

AUD/USD pullback could provide bullish opportunity

AUD/USD has been pulling back over the past 24 hours, coming off the back of the incredible rally earlier in the week. That took us through a crucial resistance zone, creating a new two-year high.

The top of that previous resistance zone is $0.7835, which is the 2016 high. With that in mind, the current pullback could provide a strong buy signal should we retrace further. Interestingly the 76.4% retracement comes in almost exactly at the $0.7835 support level. As such, a bullish outlook is in play unless we break below $0.7786.

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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.

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