EUR/USD and GBP/USD fade, while AUD/USD continues to gain ground

EUR/USD, GBP/USD and AUD/USD have been gaining ground. However, is this the beginning of a wider bullish phase or just a short-term blip?

EUR/USD retraces back into notable support level

The EUR/USD rebound has faltered after a deep retracement into the 61.8-76.4% Fibonacci zone. That points towards a potential bearish reversal coming back into play before long. With the price drifting lower since Thursday’s peak, we have seen a decline back into the $1.1018 swing low. With the price respecting that level, we could see a short-term rebound from here.

However, it looks likely that it will turn lower in the near term, with markets expected to turn their gaze to Thursday’s European Central Bank (ECB) meeting before long. A break through the $1.1154 peak would bring a more bullish picture, but a bearish outlook will remain in play until that happens.

GBP/USD starts to reverse recent gains

GBP/USD managed to gain a significant amount of ground last week, with optimism that a no deal can be delayed or averted driving the pair higher.

However, we are starting the week in a very different fashion as the price reverts lower. Given the amount of ground gained throughout last week, there is plenty of downside room to move into even if we are retracing. The break through $1.2310 points towards a high likeliness that this is a retracement. Therefore, a break below $1.2210 would bring greater confidence of a deeper fallback, with a retracement around $1.2100 a distinct possibility.

AUD/USD continues to gain ground

AUD/USD managed to break through an important zone of resistance last week, paving the way for further upside. That cluster of previous support, around $0.6822-$0.6831, was a key resistance area that stood in the way of a wider bullish phase coming into play.

With this in mind, look out for further upside from here, with a break back below $0.6807 required to negate this bullish short-term view.

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