FX levels to watch: EUR/USD, GBP/USD and NZD/USD
Dollar strength is driving the likes of EUR/USD, GBP/USD and NZD/USD lower. However, with uptrend in play, another leg higher could be coming for all three.
EUR/USD consolidating after recent gains
EUR/USD failed to really push on at the end of last week, with Friday’s rebound failing to gain enough traction to push the pair through the $1.1514 peak.That means we could be looking at a retracement, with the recent rally having moved into and reversed around the 76.4% Fibonacci level ($1.1503).
A break below $1.1434 would provide a more bearish outlook, with confirmation coming on a drop below $1.1406. Until then, there is a chance we could rebound from here.
GBP/USD continues to drift lower
GBP/USD has been drifting lower after a recent uptrend that took the pair into a three-month high.
The current move lower looks to take the form of a falling wedge, with a strong possibility that the wider bullish trend will come back into play once more. A break through the $1.3160 swing high would signal that bullish shift. Otherwise, watch to see if we can break below this trendline support, with the 200-day simple moving average (SMA) also providing support.
NZD/USD pullback likely to bring another leg higher
NZD/USD has been drifting lower since Friday’s high, with the pair moving into the potential ascending trendline support.
The trend over the short term points towards this sell-off being temporary, with another leg higher likely before long. As such, this sell-off looks like a buying opportunity, with a drop below $0.6805 required to negate the bullish outlook.