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

The release of two ‘Remain’ polls over the weekend has lit the fuse under European FX markets, yet will this persist and what will be the impact upon USD/JPY?

EUR/USD forex cross
Source: Bloomberg

EUR/USD rallies as Brexit fears abate
A big gap opened for EUR/USD this morning following renewed hope a Brexit will be averted on Friday. The deterioration that we saw emerge last week has been negated and a more bullish outlook is now in play, owing to the break through the $1.1301 resistance.

Any subsequent retracement would be looking at $1.1321 as the key near-term support level to watch. However, it seems likely people will be buying on dips as this recovery extends, with initial resistance levels at $1.1382 and $1.1415.

Notable support levels are found at $1.1337 and $1.1323.

GBP/USD returns to bullish mindset
IN_GBPUSD has finally come back into favour over the past two trading days, reacting to renewed hope of a ‘Remain’ vote. The massive gap higher over the weekend has subsequently been followed by further gains.

The pair will continue to be highly responsive to any polls that are released, yet for now things are looking significantly more bullish. With that in mind, it makes sense to buy on retracements, for a continuation of this recovery.

Resistance levels of note are at $1.4601, $1.4623 and $1.4668, with support at $1.4544 and $1.4477.

USD/JPY gains amid risk-on sentiment
IN_USDJPY saw a more moderate gap higher overnight, following the risk-on rally seen across indices and European currencies. We are currently seeing a period of consolidation, yet any deeper retracement towards ¥104.39 or ¥104.28 would look interesting for a long.

This could simply be a retracement of the sharp downturn on Thursday, yet further gains seem likely in the short-term. A break back below ¥104.10 would negate this view.

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