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

A potential breakthrough in Brexit talks has bolstered sterling, while USD/JPY has steadied after a drop overnight.

EUR/USD downtrend intact

Short-term support for EUR/USD has been found around $1.13, coinciding with a decent bounce from intraday oversold conditions.

However, for the moment this merely looks like a lower high within the current downtrend. A turn lower from below $1.1146 would mark another potential selling opportunity, and would see the $1.13 area tested again. A bounce above $1.14 would open the way to $1.145 and then $1.155.

GBP/USD surges on Brexit news

News of a deal between the EU and the UK over financial services has bolstered GBP/USD, with the pair recovering ground lost over the past week.

We may have a change of short-term trend here, although it will be important to watch how the price behaves around intraday pullbacks. Further upside would target $1.2926 and then $1.303.

USD/JPY recovers from mid-week sell-off

We saw some weakness for USD/JPY yesterday but the overall push higher remains intact.

The pullback from ¥113.40 may see further buyers enter, continuing the sequence of higher lows. A move back below ¥112.50 would put a more bearish view on things, potentially targeting ¥111.50.

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