CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure. CFDs are a leveraged product and can result in losses that exceed deposits. Please ensure you fully understand how CFDs work and what their risks are, and take care to manage your exposure.

Small gains for EUR/USD and GBP/USD: technical analysis

Powell’s speech yesterday did hit the dollar, but the greenback is firming up today, resulting in only limited upside for the likes of the euro and sterling.

EUR/USD bounce stalls

The EUR/USD pair has bounced from $1.112 over the past week, but rallies since late April have run out of steam around $1.126, and so far gains over the past three sessions have failed to hold above this level.

Further upside targets $1.13 and then on to $1.133, while a move back below $1.122 would raise the prospect of a return to $1.112.

Small gains for GBP/USD

GBP/USD has clawed its way higher over the past few days, with higher lows in place since the end of May.

Gains in late May staled at $1.275, so this is the first area of resistance to watch for, followed on by the spike higher on 21 May to $1.2815. The short-term bullish view persists unless we see a move back below $1.264.

Bottoming action in USD/JPY

Price action here over the past few days suggests that a short-term bottom may have been formed for USD/JPY, but it is still a lower low as the pair continues its drop from the late April highs.

The price has stabilised around ¥108.00, so if this continues to hold then some upside may result, but ¥108.40 has provided resistance so far this week. Trendline resistance from the late April high would see the price run into a possible area of resistance around ¥109.50. A close below ¥107.80 would open the way to more downside.

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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