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

A bullish GBP/USD, unresolved EUR/USD and bearish AUD/USD show a mixed FX market after Trump’s tax plans fell flat.

Dollar and pound
Source: Bloomberg

EUR/USD pushing higher after pullback

EUR/USD is back in the ascendancy this morning, coming off the back of a moderate pullback yesterday morning. We have seen the pair move higher since, as it seeks to follow the gains seen in the wake of the French election.

A break back above $1.0951 would give us the confirmation that we are going to see this uptrend persist. Given that we have broken above $1.0906, the wider uptrend remains in play, which means we could see a decent pullback of the $1.0569-$1.0951 rally. A break below $1.0855 would provide a warning sign that we could move into retracement mode.

GBP/USD rallies into new six-month high

GBP/USD has pushed temporarily through last week’s high of $1.2908, following a gradual continuation of the snap election strength.

The ability to post an hourly close above $1.2908 would be key to providing a signal of further upside to come. It does look like we should have further upside in the tank for this pair, with a break below $1.2756 required to negate the bullish outlook.

AUD/USD turning lower from resistance

AUD/USD is turning lower this morning, following a rally into the last week’s low of $0.7491. The fact that we saw the pair manage to break back below the $0.7491 support level yesterday was crucial in providing a resumption of the bearish view instigated in mid-April (when the $0.7491 double top neckline was broken).

With that in mind, we could see significant downside, yet an hourly close below $0.7455 would be a sensible bearish signal to await to negate the potential of a bigger upside retracement.

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