FX levels to watch – EUR/USD, GBP/USD, NZD/USD

Convergence across European currencies sees the euro continue to gain while the pound plummets. Meanwhile, could we be set for further gains in NZD/USD after a key trendline break?

New Zealand dollar note
Source: Bloomberg

EUR/USD pushing higher following pullback

EUR/USD has managed to maintain price action above the $1.0686 level, with yesterday’s pullback coming into the $1.0700 mark before turning higher once more. It looks like we are seeing the pair moving into another leg higher and as such, a bullish outlook remains in place unless we see an hourly close below $1.0686. Watch out for $1.0800 as the next major resistance point to break through.

GBP/USD turns lower following retracement

GBP/USD is selling off sharply following on from a deep 76.4% retracement overnight. It is clear the pair has moved back into a bearish mode, which coincides with the wider, longer-term trend.

With that in mind, further downside seems likely, where the $1.2570 support level comes into view as a near-term target. As long as price does not break through $1.2683, a bearish outlook is in place.

NZD/USD rally looks set to continue

NZD/USD saw a sharp rally yesterday, with price managing to break through a trendline which dates back to January. The fact that we have seen price pull back and respect this line as new found support provides a bullish signal which could yet drive further gains. This rally forms a wider retracement of a downturn from $0.7403, with the recent rally through the 50% pullback meaning we are now looking towards the 61.8% ($0.7238) and 76.4% ($0.7301) levels for the bearish view to come back into play.

The 76.4% pullback has popped up a number of times over recent months and another rally into that level could be interesting. In either case, a short-term bullish outlook is in play, with the ability to remain above $0.7193 key to further gains.

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