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

Cable continues its ascent, while USD/JPY has stalled after an impressive rally. 

Pound sterling coins and US dollar note
Source: Bloomberg

GBP/USD continues to climb

A steady climb goes on here, with little sign the pound’s gains have come to an end yet. The next area to watch is $1.2680, while the bears will need to get GBP/USD back below $1.24, where the pair formed a base earlier this week. The break above $1.2557 seems to be holding, which sets cable up nicely for the week ahead. 

EUR/USD slumps to two-week lows

Yesterday saw EUR/USD hit its lowest level in over two weeks, and a turn lower this morning suggests the price will head yet lower. Since January, the key level to watch has been $1.0825, with a break through here suggesting a test of $1.0714 and then $1.0525.

This would be longer-term, and we could see a bounce back towards $1.11. However, we would need to see a move through $1.13 to negate the current downtrend. 

USD/JPY stalling at ¥107

USD/JPY opened above the 200-day simple moving average (SMA) for the first time since December 2015, but it is currently unable to push on beyond ¥107. Instead, we could see a retracement, as the price pulls back from overbought levels.

A move lower towards ¥104.30 would not imperil the longer-term uptrend, and even a retest of the 50-day SMA (currently ¥103.12) could still bring out fresh buying. 

AUD/USD rallies continue to be sold

It has been quite the week for AUD/USD, but each rally has been firmly sold, and now we see the price testing the rising uptrend that has lasted since January. A close below here could ignite a move to the 200-day SMA, $0.7506, and potentially on towards $0.7423.

A rally needs to clear the 50-day SMA at $0.7615 and then push on back above the Thursday high of $0.7740. 

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