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

Sterling stumbles, as polls point towards a potential hung parliament, while dollar strength for EUR/USD and USD/CAD pairs seems likely. 

Canadian and US dollars
Source: Bloomberg

EUR/USD tests trendline resistance

EUR/USD has managed to rally into trendline resistance at the start of the week, with the recent descending channel coming into question once more.

Given the wider uptrend in play, the bullish breakout signal we are looking for is an hourly close above $1.1205. Until then, the channel remains in play and thus we could start to see the pair come off somewhat. An hourly close below $1.165 would point towards a move into the lower end of the channel ($1.1114).

GBP/USD falls on election uncertainty

The GBP/USD strength of April and May seems to be on the wane, as polls point towards a far from secure election ahead in the UK.

The pair has been attempting to regain ground after bottoming out on Friday, yet the downtrend seems likely to return, with an hourly close below $1.2775 and $1.2756 pointing towards further downside. Should that come to fruition, we will be looking at the Fibonacci levels for support, with the 50% ($1.2707), 61.8% ($1.2626) and 76.4% ($1.2527) in view.

USD/CAD to rebound from trendline?

USD/CAD has begun to reverse higher from trendline support this week, following a period of weakness for the pair. For now we are in a discovery phase, with bullish confirmation coming an hourly close above $1.3506. That would necessitate a break through both trendline and simple moving average (SMA) resistance, thus providing greater confidence of a bullish reversal.

Until then, the downtrend remains in play, and thus any further downside would bring trendline support into play once more.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.