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

A potential resurgence for the dollar appears to be in the offing, with EUR/USD trending lower and AUD/USD showing signs of indecision around a crucial historical resistance zone.

Euro and US dollar notes
Source: Bloomberg

EUR/USD consolidates within downturn

EUR/USD has consolidated overnight, following on from a weak end to last week. The break lower from the 76.4% retracement points toward the potential for a prolonged period of downside.

An hourly close below the $1.0603 mark would provide a near-term sell signal for another leg lower. Conversely, an hourly close above $1.0627 would point towards a bigger move higher, toward the $1.0647 region.

GBP/USD to bounce from triangle bottom?

GBP/USD is trading around an important support region, following on from Friday’s weakness for the pair. The continued rallying we have seen from this region has provided a trendline support and symmetrical triangle formation.

With the stochastic crossing in a bullish manner (which has provided reliable buy signals on past two occasions), there is a good chance we could see a bounce from here. The breakout we are looking for is either an hourly close above $1.2524, or below $1.2388. Until either happens, the triangle remains the subject of our attention.

Could AUD/USD uptrend come under pressure?

AUD/USD has posted a second consecutive doji candle on the weekly timeframe, following a strong run into the crucial $0.7730-$0.7835 resistance zone. That historical zone has seen the market turn lower on a number of occasions. With that in mind, there is a good chance we could start to see this market weaken. For a bearish view to come into play, we would need to see a break below $0.7637.

However, until then a convergence of two trendlines should form sufficient resistance to limit further upside. That said, we would need to break through the $0.7700 region to feel confident of further gains. Until then, watch out for potential reversal signs to set us up for a prolonged period of weakness for the pair.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.