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

A pullback in EUR/USD could see buyers enter again, while GBP/USD recovers from yesterday’s CPI reading. 

Yen and dollar
Source: Bloomberg

EUR/USD with a buying opportunity?

A steep overnight pullback in EUR/USD could provide another buying opportunity, with the price heading towards the 50-hour simple moving average (SMA) at $1.1516, and towards the $1.1514 support zone that held during the early part of Tuesday’s session.

A bounce from here might then target the highs of Tuesday at $1.1583. We would need to see a push below $1.1442 on the daily chart to become particularly bearish here.

GBP/USD recovers after poor CPI

GBP/USD has managed to shake off the sudden drop yesterday following the weaker consumer price index (CPI) reading, finding support around $1.30.

If it remains below $1.3048, we could see a fresh test of $1.30 and then down to the 50-day SMA at $1.2878. A move back above $1.3048 would signal that another attempt at $1.31 is underway.

USD/JPY hits SMAs zone

Support yesterday at ¥111.70 was matched by a confluence of the 50-, 100- and 200-day SMAs in the ¥111.70/¥111.80 region, hindering downward progress for USD/JPY.

If the rally off the lows runs out of steam around ¥112, a break below ¥111.70 would clear the way towards ¥110.86 and then to ¥109.

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