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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 downside sees gains across EUR/USD, GBP/USD and AUD/USD. However, with the potential for further downside, these moves could be fleeting.

GBP/USD
Source: Bloomberg

EUR/USD closes gap after German election sell-off

EUR/USD has regained ground after an initial gap lower in the wake of the news that we could be heading back to the polls in Germany.

With the price gradually trending lower in the wake of the rally up through $1.1836, there is a good chance we could be set for further short-term losses. A break up through the $1.1822 level would negate this short-term bearish view. Until then, watch out for a possible weakening, as long as the price remains below $1.1822.

GBP/USD rallies towards trendline resistance

GBP/USD has seen sharp gains in early trade today, with the price moving into a two-week high. However, with the price moving into trendline resistance, and with the stochastic indicator overbought, there is a good chance we could see a retracement from here.

That being said, we would need a break back below $1.3186 to negate the short-term uptrend, with the price still not reaching the upper bounds of the range in place for over a month. With that in mind, a short-term pullback could subsequently provide another leg higher. However, should we reach it, look out for this market to start its turn lower from around the $1.3310 region in respect of the wider range.

AUD/USD rallying back towards trendline resistance

AUD/USD is similarly gaining ground this morning, following on from a clear recent downtrend for the pair. Given the wider downtrend, there is a strong chance that we will see another leg lower before long.

Therefore, any further upside would be viewed as a selling opportunity, if the price does not break back above $0.7608. Watch out for the Fibonacci resistance as a potential area for the market to turn lower, with the 61.8% looking like an interesting area, given the confluence with trendline support.

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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