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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, USD/JPY, AUD/USD

Another dip for EUR/USD is being met with fresh buying, while USD/JPY has recovered a key resistance level, and looks set to move higher.

Euro notes
Source: Bloomberg

EUR/USD - bearish outlook in short term?

A swift reversal in EUR/USD have caused some worries for euro bulls, but the rally may not be entirely done yet.

Short term, we can expect some bearish developments if the price falls below $1.11 on the hourly chart, but longer term, as long as the price holds $1.10, the buyers are firmly in charge. A recovery will target $1.13 and then $1.1366.

USD/JPY moves higher

The recovery in USD/JPY bodes well for risk assets as a whole, with the break back above key resistance at ¥111.68 a good first step in any recovery. A rally from here would head towards ¥112.50, where it may encounter resistance as it reaches the downtrend line off the 10 May high.

A move above the 100-day simple moving average (SMA) at ¥112.60 would then target the May high at ¥114.37. Bears need to see a daily close back below ¥111.68 to restore the negative outlook. 

AUD/USD uptrend remains if the price holds above $0.74

A dip overnight prompted by news of a China's downgrade by Moody's was met by fresh buying, so we could see a move back to $0.7510 and higher in AUD/USD.

The 200-day SMA at $0.7536 still needs to be broken, but aslong as the price holds above $0.74, the upside picture remains intact. 

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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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