EUR/USD and USD/JPY look set to return, while GBP/USD remains bearish

Dollar on the slide, as EUR/USD and USD/JPY look to reverse recent moves. Meanwhile, GBP/USD remains within a bearish trend.

EUR/USD shows signs of bullish reversal

EUR/USD has managed to break through a key resistance level amid the release of weak US Manufacturing and ADP non-farm payroll (NFP) figures.

The rally above $1.0959 looks to have completed an inverse head and shoulders formation, pointing towards a period of upside from here. As such, further gains seem probable, with any short-term downside likely to be a buying opportunity unless we see a break below the $1.0904 and $1.0879 levels.

GBP/USD volatility fails to break through intraday resistance

GBP/USD has seen a ramp up in volatility of late, yet the downtrend of the last week remains in play.

This comes off the back of a head and shoulders formation, with the price continuing to create lower highs and lows. A break through the $1.2346 level would bring about a more bullish picture, yet until that happens it makes sense to expect further downside for this pair.

USD/JPY drops into double top neckline

USD/JPY has seen significant downside as growth and trade war fears ramp up to the benefit of the haven yen.

The recent rally took us into both trendline and swing high resistance levels, where the subsequent decline looks to complete a double top formation. Should we see a break below ¥106.96, it would complete that bearish pattern to point towards further downside from here. As such, today’s price action will be dictated by whether that level is breached or not.

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