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

There have been mixed fortunes across the FX spectrum, with EUR/USD losing ground to the dollar, while the pound attempts to push higher once more. Meanwhile, we are looking out for a potential short-term bounce in AUD/USD.

Pound coins and dollar notes
Source: Bloomberg

EUR/USD pulls back to Fibonacci support
EUR/USD has finally started turning lower, following a move above the 76.4% retracement of June’s referendum sell-off. So far this morning, we have seen it fall into the 76.4% pullback of last week’s rally.

While we could see a bounce from here, it seems likely that we are seeing a trend change for the short-term, to revert to the bearish trend of recent years. For further confidence of this move, an hourly close below $1.1241 would be a particularly bearish signal. 

GBP/USD pushing higher once more
Once more it is the 76.4% Fibonacci retracement that is coming into play, with IN_GBPUSD having pulled back to this level ($1.3027) following a rally above the key $1.3094 swing high.

Given this break higher, it seems likely we will see this pair gain ground once more to continue the consolidation of the past two months. Thus, a bullish view is in place for the short-term, with a move back to $1.3186 likely. This view holds unless we see an hourly close below $1.2978.

Awaiting follow through or deep retracement for AUD/USD
AUD/USD saw a strong move lower last week, following the push into a multi-year descending trendline. This points towards the potential for a top in play and as such, further downside seems likely soon enough.

However, last week taught us that this pair is in a somewhat choppy phase, and thus another deep retracement could not only provide us with a nice strong rally, but also another 76.4% pullback to get short once more. 

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