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

FX markets are quiet compared to equities, but the downtrend continues for EUR/USD, though USD/JPY has been able to recover for now.

EUR/USD still in broader downtrend

The price of EUR/USD fell back sharply yesterday, but as has happened twice this week, it found support around $1.131.

However, sustained rallies have been missing of late, as we saw yesterday with a push to $1.14. A close above $1.142 is needed to break above the recent lower high. Meanwhile, below $1.13 the price will head towards $1.1268 and then $1.1216.

GBP/USD rallies back above $1.27

Dips in GBP/USD below $1.27 this week have found buyers, but intraday rallies have been sold, as we have seen so far this week.

The following have all come in as areas of resistace: $1.28, $1.285 and $1.29, so these areas will need to be breached. Below $1.27, the $1.2635 and $1.259 areas come into view.

USD/JPY recovers after losses

For now the price of USD/JPY has bounced, potentially forming a higher low. If it can hold these gains and move back above the 50-day simple moving average (SMA) of ¥113.06, then a rally back to ¥114.00 and higher is possible.

Further declines target ¥112.30 and the October low at ¥111.37.

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