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

Dollar strength was the standout feature of last week, but is it ebbing as March progresses?

EUR/USD rally starts to ebb

The pair has recovered somewhat from the beating it received after last week’s European Central Bank (ECB) meeting, but EUR/USD remains well below last week’s highs.

Having bounced overnight from below $1.23, upward momentum appears to be fading, raising the prospect of a fresh move lower. The 50-day simple moving average (SMA) at $1.2280 is the first area of possible support, and then below the $1.2165. A longer-term rally needs to clear $1.2450.

GBP/USD maintains downward bias

Cable has trended lower since the end of January, and last week saw another bout of selling develop for GBP/USD around $1.39.

If momentum falters around this level again, we look to the $1.37 as the next major area of possible support. It would require a daily close above $1.39 to break the procession of lower highs.

USD/JPY turns lower again

The dollar enjoyed a good week, rallying from the lows near ¥105, but there is a risk for USD/JPY that the 2018 downward trend is reasserting itself.

The pair has faltered around ¥107, and if a new lower high is created here, a move back to ¥105 and lower could be in the offing. A close above ¥107 would then signal that a possible challenge of the ¥108 high could be on its way.

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