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

EUR/USD continues to fall, spurred on by yesterday's ECB meeting, while both USD/JPY and AUD/USD seem likely to turn lower after running into major resistance.

Japanese yen and US dollar notes
Source: Bloomberg

EUR/USD breaks below key support

Yesterday's European Central Bank (ECB) meeting sparked significant volatility, yet while we saw sharp moves in both directions, it was the downside which ultimately won out.

Crucially, we have since seen price break below the key $1.0911 support level, which has subsequently been utilised as new resistance. With that major support level out the way, we have precious few levels of note until we get down to the $1.0777 region.

As such, a bearish view remains, with the creation of lower highs and lower lows utilised to ensure the downtrend is staying on track. An hourly close above $1.0952 would provide a signal we could be on the cusp of a short-term bounce.

USD/JPY rally fails to break key level

IN_USDJPY enjoyed a particularly strong session yesterday, with price rallying into ¥104.20 resistance. However, the inability to break above that level, coupled with the break below ¥103.91 could be a warning sign the sellers are due to come back into the fore.

A push below ¥103.55 would be more telling, yet as long as price remains below ¥104.20, there seems to be a good chance that we are going to move lower in the short-term. 

AUD/USD rally seems to be over for now

Despite AUD/USD trying to break free from the shackles of its multi-year descending trendline this week, we have seen the pair soon break downwards once more to continue its recent symmetrical triangle formation.

On an intraday basis, we have seen a head and shoulders pattern come into play, with the break below $0.7658 providing a bearish signal. Since then we have seen price rally into $0.7647 resistance and start to turn lower. Essentially a short-term bearish outlook is in place unless we see an hourly close above $0.7675.

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