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

The tides turn, as GBP/USD and EUR/USD gain ground at the expense of the dollar, while USD/JPY begins to move higher.

Euro note and pound
Source: Bloomberg

EUR/USD bounces from crucial support level

EUR/USD managed to rally from the crucial $1.1202 support level yesterday, after a sharp move lower threatened to provide a more bearish signal. An hourly close below that level would provide a short term bearish signal.

Conversely, an hourly close above $1.1285 would signal that the uptrend looks set to continue, negating the fact that we are no longer creating higher lows.

GBP/USD punches higher once more on election day

A massive day for the UK, and in turn the pound is clearly showing its true colours, with continued gains for GBP/USD highlighting an expectation of further gains by this time tomorrow.

The short-term trend is clearly towards the upside, and we would need to see a break through $1.2872 to negate that trend. To the upside watch out for trendline resistance up ahead.

USD/JPY retracing after recent sell-off

USD/JPY is gaining ground following a sharp move lower earlier this week. As things stand, this looks like a short-term phenomenon, with a move into the deeper Fibonacci retracements of 61.8% (¥110.11) and 76.4% (¥110.35) providing interesting areas for shorts.

Essentially, we have the continued creation of lower highs and lower lows, which would be negated by a break through ¥110.73. Until that happens, a bearish outlook remains in play.

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