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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, NZD/USD

The dollar has rebounded after comments from Trump and Mnuchin, yet with the wider uptrend in play for EUR/USD, and GBP/USD, will this be enough to change the direction over the medium term?

Pounds and dollars
Source: Bloomberg

EUR/USD pushing higher once more

EUR/USD experienced a particularly volatile day yesterday, as the initial uptrend-driven rally was undermined by comments from the US Treasury Secretary, Steven Mnuchin, and Donald Trump regarding tax reforms and the healthcare bill. Despite this giving the dollar a boost, we have seen the price action remain above the $1.07 swing low.

As such, the uptrend remains in play until we break below that level. The inability to create a new higher low on the stochastic is a bit of a worry, as this is signaling a waning momentum. However, for now, it looks like we still have a good chance of remaining within the uptrend, with the recent pullback simply providing a deeper entry.

GBP/USD consolidates ahead of next move

GBP/USD is trading within a symmetrical triangle pattern, following a sharp appreciation earlier in the week. Crucially, we have seen the bottom of this triangle come in at $1.2775, which marks the key historical resistance level from December 2016.

Essentially, while the expectation is for another leg higher from here, a signal of the next move will come with an hourly close above $1.2859 (bullish) or below $1.2775 (bearish).

NZD/USD shows signs of bearish reversal

NZD/USD has begun to turn lower, with the creation of flat lining tops and lower lows pointing towards something remarkably similar to the price action seen back in mid-March.

With that in mind, there is a good chance that the current bounce could fall short and turn lower soon. As long as the price remains below $0.7052, it looks like we could see the pair break lower once more. The $0.7031-$0.7036 region looks particularly interesting for shorts.

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