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

The dollar is coming back into focus, with potential weakness on the cards for EUR/USD, GBP/USD and AUD/USD. 

Source: Bloomberg

EUR/USD showing signs of weakness

The bearish EUR/USD picture is finally starting to come through once more, with Friday’s sharp sell-off leading to a break below the near-term $1.0563 support level. This morning’s rally is expected to be a fleeting one and, as such, a break lower is expected before long.

An hourly close below $1.0552 would be a signal that this next leg lower is occurring. Should that happen, it is likely the selling will ramp up, as it adds greater confidence that this reversal is in play. A break above $1.0618 would be required to negate the bearish implications of Friday’s sell-off.

GBP/USD bullish breakout fails to extend

GBP/USD has sold off sharply over the weekend, with talk of a second Scottish referendum ruling out the nice bullish triangle breakout we had seen for the pair.

This has brought us back into the $1.2388 support level, which could be crucial to stopping the rot. Watch out for the response at this level as a bounce here could retrace a decent amount higher, given the strength of the recent weakness. Otherwise, a break below $1.2388 could provide a clue that we are set for a period of further weakness.

Is AUD/USD going to reverse or breakout?

AUD/USD continues to consolidate below the crucial $0.7732-0.7835 resistance zone, coming off the back of a strong uptrend for the pair. This is the region where we could easily see a reversal, yet price action has not yet told us that is the case.

A break and hourly close below $0.7649 would be a strong sell signal, whereas a move below $0.7606 would increase the confidence that such a move is in the offing. Until then, the uptrend remains intact and thus further gains are still a distinct possibility. 

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.