Established in 1974
185,800 clients worldwide
Over 15,000 markets

FX levels to watch – GBP/USD, EUR/USD, USD/CAD, USD/JPY

Much of the focus has been on equity markets this morning, but we have seen continued euro strength, while the loonie remains under severe pressure ahead of potential news from the Algeria energy summit.

Dollars and yen
Source: Bloomberg

GBP/USD suffers more losses

The downward trend goes on here, with little sign so far that the pair is about to turn higher. The lows of July and August, around $1.2850, are holding for now, so until this breaks we are still looking at a possible bounce in coming days.

A rally needs to clear Thursday’s highs at $1.3121, which might then suggest a move back to the top end of the range around $1.3450. 

GBP/USD chart

EUR/USD puts buyers in charge

The pair spent Friday gathering strength after losses in the overnight session, and this morning we have seen fresh buyers push the pair back towards the Thursday high at $1.1260, the area where gains stalled in the period 12-16 September.

Above here, we would expect a push on to $1.1320. Last week saw the pair’s downside movement stop at the 200-day simple moving average (currently $1.1154), so this is the area to watch if the situation turns negative again.

EUR/USD chart

USD/CAD looks to move up

Friday’s Canadian retail sales shocker meant that the embryonic downtrend was rapidly turned around, with the pair finding support around C$1.3030 and then surging.

Gains have so far stalled at C$1.3180, but further moves upward today should see the pair test the 200-day SMA (C$1.3243) again.  C$1.3250 is the big level to watch, having essentially capped the pair since June. 

USD/CAD chart

USD/JPY comes under pressure
​The pair has moved off the lows of last week near the key ¥Y100 level, but has come under pressure this morning. A rally needs to push on through ¥101.20, which would clear the way to the 50-day SMA at ¥102.29.

For now, the 2016 downtrend is in abeyance, with a fresh low below ¥100 needed to confirm that it will continue to push lower.

Otherwise, we continue to wait to see if the dollar can regain some ground this week and perhaps signal that a base is still being formed above ¥100. 

USD/JPY chart

The information 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 Bank S.A. 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 and as such is considered to be a marketing communication.

Find articles by analysts