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

Having carried it all earlier this week the US dollar is now easing off slightly. 

Source: Bloomberg

GBP/USD awaiting tomorrow's data

Today sees the gap between yesterday’s UK employment figures and tomorrow’s retail sales. So far, the week has been broadly negative for sterling, with a combination of data and comments from Janet Yellen weighing on the pound.

Over the past few days the pair has been unable to hold above $1.25, so any sign that this is about to happen again could mean another selling opportunity. It will likely take a move back above $1.26 to suggest that a rally is now in the offing. 

EUR/USD heading for a new upward leg?

The pair bounced impressively yesterday, putting the price back above key support at $1.0569 and finishing well off the lows.

Tuesday’s high around $1.0635 could provide some resistance, but a close above this level could mark the start of a new upward leg in EUR/USD. Bears would need to get the price back below $1.0569 to indicate that they are still in charge.

USD/JPY in the lows

A sharp move lower in USD/JPY yesterday raises the prospect that the bounce off the ¥111.9 level is at an end. For now the price is above Tuesday’s low of ¥113.26, but if this gives way then a new lower low will be created.

Buyers would need to step in soon to turn this current dip into a higher low, with the aim being a move back in the direction of ¥115. 

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