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

US dollar weakness remains the name of the game, with EUR/USD and GBP/USD gaining ground, amid weakness for USD/JPY.

EUR/USD hits new three-year high

EUR/USD has punched through a crucial resistance level this morning, as news of a breakthrough in German coalition talks seemingly raising the chances of a continued Angela Merkel leadership.

The push through $1.2092 provides a new three-year high, and moves the pair into a region with very little resistance within close proximity. As long as the price remains above $1.2027, a bullish view remains in place, with retracements or period of consolidation looking like buying opportunities.

GBP/USD rallies after 50% retracement

GBP/USD has managed to break through the notable $1.3562 swing high this morning, coming off the back of a retracement into the 50% Fibonacci at $1.3457.

The fact that we have seen the price break through $1.3562 points towards further upside to come, with a rally through $1.3613 looking likely from here. A break back below $1.3457 would only serve to paint a picture of a deeper retracements, with a move below $1.3301 needed to negate the wider uptrend. 

USD/JPY weakening following overnight retracement

USD/JPY has continued its downtrend, with the price tumbling yesterday despite the short-term rally seen on Wednesday evening.

We have seen a similar move come into play overnight, with a short-term retracement giving way to further selling. As such, further downside is expected, with a break above ¥111.87 required to negate the bearish view. Keep an eye out for ¥110.84 as the next major support level to breach. 

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.

Find articles by analysts