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

The dollar is back in the driving seat, with EUR/USD and GBP/USD weakness looking likely amid a rally for USD/CAD.

GBP/USD consolidating at key support level

GBP/USD has managed to remain above the $1.2823 support level this morning, following a fall into the crucial $1.2723 support level.

The bearish trend looks likely to sustain given the rising likeliness of a harder form of Brexit, with UK Prime Minister Theresa May’s proposal failing to gain much traction. A break below the $1.2723 level could provide us with a good selling opportunity, utilising this recent rebound to place a stop above. We would need to see a break through the $1.2927 mark to provide a more bullish outlook for the pair.

EUR/USD continues to break lower

EUR/USD has been ramping up the selling in the wake of the reversal from trendline resistance. This continues the wider trend of lower highs, with a break below the $1.1216 level required to bring about a new lower low.

With a long-term descending trendline down below, a break below the $1.1213 level could signal the beginning of another strong move lower for the pair. A break through $1.1472 would be required to negate the bearish outlook.

USD/CAD rallies into five-month low

USD/CAD has managed to rally through the $1.3317 resistance level, continuing the bullish trend of higher highs and higher lows that has been in place for two months. That also sees the pair respect the rising channel, with trendline resistance up ahead.

With that in mind, further gains seem likely for the short term, yet we could see the sellers come back in after that, setting up another retracement. Only with a break below $1.3182 would such a retracement provide a bearish reversal signal.

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