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

A mixed bag for the dollar overnight, has seen EUR/USD push higher amid weakness for GBP/USD. Meanwhile, USD/JPY is moving back towards a crucial support level yet again.

Source: Bloomberg

EUR/USD pushes higher in retracement mode

EUR/USD has managed to move higher overnight, with the pair moving well past the short-term 76.4% retracement. Should the price rally up through the near-term swing high of $1.1616, then this would point towards a possible wider retracement of the $1.1691-$1.1554 sell-off.

Should that occur, then we would be looking at the $1.639-$1.1659 resistance zone (61.8%-76.4%) to come into play. As such, a bearish view remains unless the price breaks up through $1.1691.

GBP/USD turns lower, in threat to further upside

GBP/USD has been trading in a broadening formation over the past fortnight. Yet despite rallying from trendline support, we are seeing the pair move lower without having set a new higher high. This threatens to move the pair back towards the bottom end of the pattern once again, with an hourly close below $1.3109 providing a bearish short-term view.

Ultimately, we will need to see a break below $1.3030 to point towards a move out of this recent consolidation. However, for the short term, the ability to move back below $1.3109 would be very telling.

USD/JPY turning towards key support level

USD/JPY is selling off once again this morning, with the price having bounced from trendline support yesterday. Crucially, with the price having rallied into a major long-term resistance zone at ¥114.37-¥114.49, a break below the ¥113.53 level could bring about a strong move lower for the pair.

We would need a move back below ¥112.95 to truly negate this two-month uptrend, yet for the near term it is the ability or inability to break below ¥113.64 that will provide us with a directional bias.

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