FX levels to watch: EUR/USD, GBP/USD and AUD/USD
EUR/USD, GBP/USD and AUD/USD have been declining as they erase previous gains. Is this the beginning of a wider bearish shift?
EUR/USD dropping into critical support level
EUR/USD has continued its decline, with the pair heading into the key support zone of $1.1289 and $1.1301.
If we see the pair break below that level, we are looking at a likely wider breakdown for the pair. As such, watch out for whether or not we break below that zone, with a short-term rebound a distinct possibility until we do see such a break.
GBP/USD drifts lower within more uncertain period
GBP/USD managed to rally through the $1.2979 resistance level on Thursday, with that short-term higher high pointing towards the possibility of further upside to come.
However, with the price drifting lower, we are moving closer to the $1.2854 level which would denote a bearish continuation move. As such, the break through $1.2854 or $1.2996 would signal greater confidence in a bullish or bearish move from here.
AUD/USD drops below critical support level
AUD/USD has been declining sharply throughout the past week, with the price moving below the $0.7076 level on Friday. That negates the bullish trend that had been in play throughout the first six weeks of 2019, with further downside looking likely as a result.
Over the near term, a rally through the $0.7117 level would likely spark a short-term rebound for the pair. Until that happens, the market is likely to continue this period of weakness, with another leg lower looking likely from here.