EUR/JPY, GBP/USD and USD/JPY likely to reverse lower

Weakness likely to lie ahead for EUR/USD, GBP/USD and USD/JPY, with recent gains being reversed this week.

EUR/USD rebound likely to give way to further downside

EUR/USD has been selling off sharply since breaking below the trendline support that underpinned a symmetrical triangle over the course of last week.

Yesterday’s losses gave way to a gradual rise throughout the remainder of the day, with price now flatlining overnight. Given the recent formation of lower highs and lows, this pair is expected to decline once again. A break through $1.1025 would be required to negate this bearish short-term outlook.

GBP/USD poised for bearish reversal after recent gains

The GBP/USD uptrend has been broken this week, with price falling below the $1.2436 support level yesterday. Price has been trading sideways since, yet we look to be seeing the beginning of the next breakdown given the sharp breakdown this hour.

A break below $1.2413 would bring a confirmation signal of another bearish turn. However, with the Supreme Court ruling due for 10.30am, there is an important political hurdle to consider for sterling traders.

USD/JPY reversal slowly taking shape

USD/JPY has been turning lower from an important confluence of resistance, with price having met both ascending and descending trendline resistance last week. We have been creating lower highs and lows since, with yesterday’s sharp move lower providing the latest such move.

While the pair has managed to gain ground overnight, there is a strong chance that this is a precursor to further downside. As such, bearish positions are preferred from a deep retracement (76.4% resistance have been respected thus far), with a rise through ¥107.77 required to negate this outlook.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material 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 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. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.