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

EUR/USD, GBP/USD and USD/JPY all move sharply lower. With a bounce occurring this morning, we could be looking at another good shorting opportunity.

Pound and dollar
Source: Bloomberg

EUR/USD bounce unlikely to last

EUR/USD sold into the medium-term trend yesterday, with the 50% retracement seemingly the end of the road for its resurgence. We are seeing another retracement higher this morning, which is expected to result in another leg lower.

Given the lack of key swing highs from yesterday’s sell-off, it makes sense to look for resistance at previous key levels, such as $1.1072 and $1.1097. The bearish view holds unless we see an hourly close above $1.1170. Support levels in view are $1.1036 and $1.1024.

GBP/USD sell-off expected to continue

IN_GBPUSD has continued its deterioration yesterday, with another leg lower, creating a new 31-year low. Price now has very few support levels of note to the downside and as such further losses are likely.

Price has broken through trendline resistance and this could point towards a short-term bounce. However, any gains are seen as selling opportunities, where a return to, and below, $1.2800 seems likely before long. 

USD/JPY weakness looks set to continue

IN_USDJPY has finally broken lower following a period of consolidation last week. This morning is seeing a bounce, yet this is unlikely to last. As such, it is worth being bearish as long as price remains below ¥101.76. The next key support levels to note are ¥100.58, ¥100.00 and ¥99.00.

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