EUR/USD, GBP/USD and AUD/USD break resistance but questions remain
EUR/USD, GBP/USD, and AUD/USD gain ground amid dollar weakness, but will this move prove short lived?
EUR/USD rallies through Fibonacci resistance
EUR/USD has been on the rise of late, with the pair moving up through the confluence of 200-day simple moving average (SMA) and 61.8% Fibonacci resistance on Friday.
From a wider perspective, there is still a good chance the current rise is a retracement before we see the pair form another lower high. As such, the 76.4% resistance level at $1.1045 represents an important area to watch today, with a rise through that point raising the likeliness that we could be heading into the key $1.1917 swing high. A break through there would negate the wider downtrend that has been playing out since the $1.2011 peak from 1 September.
However, for now there is still a good chance that trend continues, with a move lower likely before long. In particular, a break back below the recent low of $1.1733 would provide a fresh bearish signal for the pair.
GBP/USD breaks resistance to complete inverse head and shoulders
GBP/USD managed to break through the key $1.3007 resistance level on Friday, bringing the completion of an inverse head and shoulders formation.
That break points towards a likely bullish phase from here, with a break back below the $1.2845 level required to negate that outlook. However, with the stochastic rolling over, there is a chance we could see a short-term pullback from here.
AUD/USD rallies into confluence of resistance
AUD/USD has rallied into a confluence of trendline and SMA resistance, with momentum starting to wane from this key zone.
The pair managed to rise sharply over the latter part of last week, with the pair posting a fresh two-week high. That rise has taken us into a deep retracement of the decline from $0.7345. A rise up through that prior peak would negate this current downtrend.
However, until that break occurs, there is a risk of us moving lower once again. The reaction to this zone will be key in determining sentiment as we move forward, with a rise through $0.7265 (76.4%) resistance heightening the potential of a bullish break.
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