CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved.

Dollar strength bears down on EUR/USD, GBP/USD and AUD/USD

A continued rise in the greenback has seen further modest losses for EUR/USD, GBP/USD and AUD/USD.

EUR/USD begins new week with declines

The EUR/USD continues its retreat from the highs seen last week, although for now the losses are small compared to the gains since early October.

Further declines below the $1.213 level are likely to see this pullback gather pace, targeting the rising 50-day simple moving average (SMA) at $1.2033. The short-term upward move of December appears to be over, but the longer-term rally is still very much in place.

GBP/USD hits one-week low

Here too the price of GBP/USD has broken below short-term support, and further declines below $1.347 are likely to reinforce the negative view for the time being.

Again, however, the longer-term uptrend is intact, with previous weakness in December finding support at the 50-day SMA ($1.3357). A move back above $1.357 provides evidence that the buyers have once again taken control.

AUD/USD continues short-term weakness

A resurgent US dollar is making itself felt here as well, with the AUD/USD seeing its most substantial decline for weeks.

A continued move lower targets the $0.75 region, where a bounce materialised in mid-December, and then close behind this is the rising 50-day SMA at $0.7444. A move back above $0.775 could restore the advantage to the buyers.

This information has been prepared by IG, a trading name of IG Australia Pty Ltd. 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.

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