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

European currencies begin to look more bullish, at least for the short-term. Meanwhile, NZD/USD appears to be turning following an overnight rebound.

US dollar and pound sterling notes
Source: Bloomberg

EUR/USD showing signs of a resurgence

EUR/USD has managed to break through the $1.0556 resistance level overnight, with the subsequent consolidation bringing a 76.4% retracement. A break and an hourly close above $1.0574 would provide greater confidence of a protracted move higher.

However, it should be remembered the price broke below the $1.0525 level yesterday, so the wider perspective points towards the rally being a retracement of the drop from $1.0680 level. With that in mind, short-term gains are perceived as something to short if we come into the $1.624 (70%) and $1.0636 (76.4%) levels. 

GBP/USD triangle breakout in the offing?

GBP/USD has shown signs of a potential bullish breakout from the symmetrical triangle that has been dominating all week. Yesterday’s break through $1.2483 was the first higher high in three weeks, with price subsequently falling into the 76.4% retracement.

With the two doji candles being followed up by the current push higher, it looks like we could see the pair challenge yesterday’s high of $1.2508, a break above which would provide greater confidence of a bullish resolution to this recent triangle. A break below $1.2402 would negate this bullish view. 

NZD/USD turning lower from Fibonacci resistance

IN_NZDUSD is selling off this morning, following a rally into the 76.4% retracement overnight. The breakout of the January uptrend has since provided us with lower highs and lows.

This rally falls into that same category, with a break through $0.7243 required to negate the bearish view. An oversold stochastic oscillator provides increased confidence of an extension of this current bearish turnaround.

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