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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 and USD/JPY

EUR/USD is enjoying a good week, but it looks like the small bounce in USD/JPY may have run its course.

EUR/USD Source: Bloomberg

EUR/USD steady after sharp bounce

The sharp rally yesterday has seen the EUR/USD pair move solidly above $1.15. Further gains target the 200-day simple moving average (SMA) at $1.1639, just above the mid-October peak at $1.162.

If this current move higher marks the end of the $1.13-$1.15 trading range, then we look to the $1.1852 highs from the middle of 2018 as the next longer-term target. Having seen a series of higher lows since the beginning of the month, new higher lows above $1.145 would mark possible buying opportunities.

EUR/USD chart
EUR/USD chart

GBP/USD staled at $1.28

The GBP/USD pair continues to edge above the 50-day SMA ($1.2774).

However, gains above $1.28 have proven too much to sustain, raising the risk of a pullback. A close above $1.28 opens the way to $1.284 and $1.2934, with the 100-day SMA at $1.2896 also a possible area of resistance. Yesterday’s weakness found support at $1.27, and if this is broken, $1.2635 comes into view.

GBP/USD chart
GBP/USD chart

USD/JPY turning bearish after decline

USD/JPY has rolled over and eaten into the gains made earlier in the week.

Having faltered at ¥109.00, we now need to watch to see if the current move higher off the ¥107.80 level fails to recover ¥109.00. If it does bounce and then turn lower, we have a new possible selling opportunity. A recovery back above ¥109.00 would revive a more bullish view.

USD/JPY chart
USD/JPY chart

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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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