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

The week has started quietly, with dollar bulls trying to recover after their drubbing on Friday. 

Euro and dollar
Source: Bloomberg

EUR/USD looks set to continue upward progress 

Last week’s dip held above the crucial $1.1080 area, and since then dips have been strenuously bought. Friday’s EUR/USD peak took out the high from 22/23 May, around $1.1250.

So far it looks like we will continue to see an ascent to $1.13. Conversely, a move below $1.11 is needed to indicate that upward progress has stalled. 

EUR/USD chart

GBP/USD needs to break above $1.29

This morning’s services purchasing managers index (PMI) could revive a flagging bounce in GBP/USD, but it needs to get back above $1.29, an area that has seen significant selling pressure in recent sessions.

The trendline was lost earlier in May, and last week an attempt to move back above it failed around $1.29. Last week’s support at $1.2775 and the 50-day simple moving average (SMA) at $1.2771 now come into play. 

GBP/USD chart

USD/JPY remains bearish 

USD/JPY continues to hover just above the 200-day SMA at ¥110.35, having seen the downtrend reassert itself with venom on Friday.

A break below this and the ¥110.11 level would clear the way to the ¥108 area of mid-April. It needs a close above the 100-day SMA at ¥112.25 to reverse the still bearish outlook. 

USD/JPY chart

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