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

Dollar weakness continues to aid the euro and sterling, while USD/JPY seems set for further losses. 

Pounds and dollar
Source: Bloomberg

EUR/USD with support at $1.1384

So far this week $1.1384 has acted as support for EUR/USD, preventing further downside, so this is the area the bears need to break, ideally with a close below $1.1366.

An upside move requires a break back above $1.1445, which would give it the strength to test $1.15. 

EUR/USD price chart

GBP/USD at risk of a drop to $1.2911

GBP/USD has broken the descending trendline off the highs from late June, but now we could see a retest of these levels and a drop back towards $1.2911, the 50-period simple moving average (SMA) on the four-hour chart.

Longer-term, the price needs to clear $1.3084, which has been a hurdle before, in May. A move below $1.2825 is needed to restart the downward trend. 

GBP/USD price chart

USD/JPY heading down

The bearish failure to break ¥114.37 earlier in the week continues to set the tone for USD/JPY.

Dips below ¥113 saw buyers, but the inability to move back above ¥113.50 suggests that the next move will be downwards, towards ¥112.75 and lower. 

USD/JPY price chart

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