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, USD/JPY

EUR/USD and GBP/USD begin to turn lower, while USD/JPY seems to be ignoring this dollar strength as it falls further.

IG Analyst

Publication date : 2017-06-07T09:20:50+0100

USD/JPY notes

Source: Bloomberg

EUR/USD breaking lower from triangle formation

EUR/USD is currently breaking through trendline support, within a triangle formation that has been in play over a week. This signals a potential breakdown in the current uptrend. However for it to come to fruition, we would need to see an hourly close below $1.1240. Should that occur, then a bearish view would come into play.

Until then, the uptrend remains in play, with an hourly close above $1.1285 providing the strongest indicator that we are set for another leg higher.

EUR/USD chart

EUR/USD chart

EUR/USD chart

GBP/USD shows signs of reversing lower

GBP/USD has been gaining ground for almost two weeks now, following a sharp deterioration in late May. Given that this recent rally was preceded by a break below $1.2831, it is likely that we are seeing a retracement before we sell off once more.

The shorter-term price action is now starting to show that weakness is coming to the fore, with the price failing at the $1.2921 resistance level. The next big bearish sign we are looking for would be an hourly close below $1.2872. Until then, there is a good chance that we could see another leg higher given the recent trend.

GBP/USD chart

GBP/USD chart

GBP/USD chart

USD/JPY falling once more after minimal retracement

USD/JPY is selling off again this morning, following a 23.6% retracement overnight. The events of this week are clearly helping the yen, with further downside expected. The short pullback overnight provides us with a relatively near stop loss, which therefore makes a strong risk to reward trade more attainable.

As such, an hourly close below ¥109.18 would provide a bearish signal, with stop above the overnight swing high of ¥109.63. Alternately, an hourly close above that level would negate this recent downtrend and would point towards a period of consolidation or retracement.

USD/JPY chart

USD/JPY chart

USD/JPY chart

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.

Find articles by writer

CFDs are complex 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. Professional Clients can lose more than they deposit.

The value of shares and ETFs bought through an IG stock trading account can fall as well as rise, which could mean getting back less than you originally put in. Please ensure you fully understand the risks and take care to manage your exposure.

IG does not issue advice, recommendations or opinions in relation to acquiring, holding or disposing of a CFD. IG is not a financial advisor and all services are provided on an execution-only basis. This communication is not an offer or solicitation to enter into a transaction and shall not be construed as such.

IG is a trading name of IG Limited a company registered at 2702 & 2703 Level 27, Tower 2, Al Fattan Currency House, DIFC, Dubai, United Arab Emirates. IG is authorised and regulated by the Dubai Financial Services Authority (DFSA) under reference No. F001780.

The information on this site is not directed at residents of the United States, Belgium or any particular country outside the UAE and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.