EUR/USD, GBP/USD and NZD/USD weakening as the dollar starts to strengthen
EUR/USD, GBP/USD, and NZD/USD drift lower, but will this dollar resurgence last?
EUR/USD rolls over into crucial support level
EUR/USD has been reversing some of its recent gains, with the pair weakening from around the 76.4% Fibonacci resistance level of $1.2116. Interestingly, we have now broken from an ascending channel, with the decline through $1.2056 also ending the trend of higher lows.
The price has subsequently been building on that bearish signal, with the notable level of $1.199 currently being challenged. A move below this point brings a continuation of that current bearish trend that has been building. To the upside, a rise through $1.2076 would be required to bring a more positive outlook for the pair.
GBP/USD continues to consolidate as we await breakout
GBP/USD has been in consolidation mode over the course of the past two-months, with the pair showing few signs of breaking from that $1.367 to $1.4006 range anytime soon.
Within that range, we have recently seen the pair channeling lower, with the 61.8% Fibonacci level providing support on Friday. This highlights the potential inverse head and shoulders pattern coming into play throughout this two-month period.
With that in mind, the recent decline looks likely to be a precursor to us breaking higher. However, we would ultimately need to see a break through $1.367 (bearish) or $1.4006 (bullish) to bring a more confident breakout signal for the pair.
NZD/USD fails to sustain jobs bounce
NZD/USD saw a brief bout of gains off the back of an impressive jobs report overnight. However, that move failed to hold for long, with the pair starting to turn lower after confronting a descending trendline.
The recent bearish reversal seen for the pair highlights a potential for further weakness from here. Interestingly, this recent bounce provided the third touch of a now confirmed ascending trendline, which could become support as we move lower. Nonetheless, further downside looks likely unless we break through $0.7212, with the pair expected to drift lower as we move forward.
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. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.
Start trading forex today
Find opportunity on the world’s most-traded – and most-volatile – financial market
- Trade spreads from just 0.6 points on EUR/USD
- Analyse with clear, fast charts
- Speculate wherever you are with our intuitive mobile apps
See an FX opportunity?
Try a risk-free trade in your demo account, and see whether you’re onto something.
- Log in to your demo
- Take your position
- See whether your hunch pays off
See an FX opportunity?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from just 0.6 points on popular pairs
- Analyse and deal seamlessly on fast, intuitive charts
- See and react to breaking news in-platform
See an FX opportunity?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
