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

Renewed USD weakness has driven some interesting moves in FX markets, with some key trends back in action.

EUR/USD touches $1.25 again

Yesterday’s remarkable volatility for EUR/USD ended with euro bulls firmly in control, as the dip buyers returned with a vengeance.

The $1.25 area stalled progress in January, so this is the key area to watch now, with a close above here opening the way to $1.2746. Support levels are to be found at $1.2323 and then $1.2165.

GBP/USD aims for more gains

The rebound goes on here for GBP/USD, with the dip buyers seizing on yesterday’s post-US consumer price index (CPI) weakness with abandon.

The first level to watch for resistance is $1.4067, and if this is broken then we move on to the January high at $1.4345. The uptrend has reasserted itself, and it would need a move back below $1.38 to suggest that the sellers are back in charge.

USD/CAD plummets from C$1.26

Having spent several days trying to hold above C$1.26, USD/CAD reversed sharply yesterday.

With the sellers back in control, intraday rallies should be sold, with the potential for a move back down to the January lows at C$1.2252. It would require a close above C$1.2650 to reverse this view.

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