FX levels to watch: EUR/USD, GBP/USD and AUD/USD
The dollar has been gaining ground, with EUR/USD and GBP/USD pulling back. However, with intraday uptrends in play and AUD/USD breaking higher, are we set for another leg higher?
EUR/USD pullback brings buying opportunity
EUR/USD dropped sharply on Thursday, with the uptrend coming into question as a result.
However, with the fact that we continue to create higher highs and lows, this could be a good buying opportunity unless we break below the $1.1406 swing low.
GBP/USD shows signs of potential bearish shift
GBP/USD has been declining throughout the week, with the rebound on Thursday failing to break through the $1.3213 peak. The current move lower threatens to derail the upward trend, with a break below $1.3054 required to bring about an intraday bearish outlook.
As such, watch for whether that level breaks or not as a guide on whether to begin looking at things in a more bearish manner or not. Until then, the bullish trend remains intact.
AUD/USD reaches key SMA resistance
AUD/USD has rallied into the 200-day simple moving average (SMA) resistance, with the pair turning lower since. That level is marginally above the 76.4% Fibonacci level, thus representing a deep retracement of the $0.7393-$0.6833 sell-off. A break through that $0.7393 level would signal a wider bullish reversal. However, there is still a risk of this market turning around before long.
For now, a further decline does seem likely, yet we need to see a swing low taken out before a more bearish wider picture can come into play. A rally through $0.7295 would signal that the pair is likely to keep on moving upwards towards $0.7393.
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