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

A key day for FX sees USD/JPY under some pressure. With key speeches today from big-name central bankers, the potential for volatility is increasing. 

Euro notes
Source: Bloomberg

EUR/USD – bullish view  remains in play?

The pair’s move higher off the lows of last week remains intact, although it has yet to breach the $1.12 area in a meaningful way.

Above this would be $1.1270 and then $1.13. It would take a move below the $1.1139 and then $1.1109 area to begin to unwind the bullish outlook for EUR/USD

GBP/USD – another test of $1.2616 on the way?

The downtrend continues for GBP/USD, with a bounce from last week’s lows around $1.26 fizzling out around $1.2750. A push back below the weekly pivot at $1.2706 would signal that another test of $1.2616 is on its way.

As before, $1.2814 is the area that needs to be cleared before we can expect more sustained upside in this pair.

USD/JPY momentum indicators where reversals have begun

USD/JPY has run into the 100-day simple moving average (SMA) at ¥111.80, with momentum indicators, such as stochastics, now in the area where reversals have begun (see mid-March and mid-May).

A close back below ¥111.68 could well see a fresh downward move begin, targeting ¥110.11 and lower. A daily close above the 100-day SMA would be a bullish development, and potentially open the way back to ¥114. 

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