FX levels to watch: EUR/USD, GBP/USD and AUD/USD
EUR/USD, GBP/USD and AUD/USD are all in decline this morning, with the dollar expected to continue gaining ground. With key support levels coming into play, we still have hurdles to overcome for EUR/USD and GBP/USD bears.
EUR/USD falls back from major resistance level
Monday’s EUR/USD rally saw the price attempt and fail to break through the notable $1.1265 swing high. The subsequent pullback brings us into an interesting area, where there is a possibility of another leg higher.
The short-term creation of higher lows remains in place for now, alluding to a potential rebound, yet the wider picture points towards the pair breaking down before long. As such, watch for further downside over the near term, with a drop below $1.1135 required to negate the recent gains and bring about a bearish picture once more.
GBP/USD head and shoulders drives pair lower
GBP/USD is continuing to fall in the wake of a head and shoulders formation, with the break below $1.2967 providing us with a more confident bearish picture.
We are now seeing that decline take the price towards the $1.2865 support level. A break below that level would signal a wider bearish picture coming into play following a largely bullish first quarter (Q1) of 2019. As such, watch out for how we respond to that area of support as a determinant of where we go from here.
AUD/USD triangle break brings return of downtrend
AUD/USD fell below the $0.6962 support level on Monday, bringing with it a renewed bearish outlook.
With that in mind, we are looking for further downside to come, with a break through the $0.702 required to negate this current bearish outlook. However, traders could also look towards the $0.6963 area for stop losses, given the minor swing high set on Tuesday marginally below that level.
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