Downtrend remains intact for GBP/USD, USD/JPY and AUD/USD, yet with notable support levels coming into view, could we see a recovery of sorts?

Source: Bloomberg

EUR/USD moves back into bullish phase
EUR/USD reversed higher yesterday, with price creating a double bottom, with the next leg higher coming by utilising the neckline as newfound support. We have seen EUR/USD sell off heavily this morning, yet if this new bullish trend is to sustain, we will need to see a move higher in the near future.

As such, a bullish outlook is in play unless we see a closed hourly candle below $1.0773. Support levels of note are at $1.0781, $1.0773 and $1.0710, with resistance at $1.0808, $1.0828 and $1.0848.

GBP/USD downtrend intact
GBP/USD continues to sell off heavily, with the next leg lower having happened at roughly the same time as yesterday’s. Given that we have now passed through the $1.4600 support level, there is unlikely to be too many further losses for now, with previous occasions showing that upon breaking to an intraday low, this pair typically consolidates and retraces once more.

Given that price has now moved down to trendline support, with the crucial $1.4566 level (April 2015 low) within close proximity. Therefore while we have not seen any bullish reversal signs, it makes sense to see how the pair reacts to these two support levels before being heavily bearish once more. Key resistance levels are at $1.4638, $1.4663 and $1.4693.

Further selling expected for USD/JPY
USD/JPY has been consolidating this morning, following on from yet another leg lower for the currency pair. Given the clear downtrend in play, further losses are likely. In yesterday’s low of ¥118.25 we have a strong resistance level which should cap any further upside.

However, ¥118.79 represents the ultimate backstop, where a move above this level would devalue the bearish view significantly. That said, this seems unlikely and thus further losses are expected.

Key support levels are at ¥117.66 and ¥116.21, whereas resistance comes in at ¥118.25, ¥118.60 and ¥118.79.

AUD/USD sells into trendline support
AUD/USD sold off once more yesterday, bringing price back down towards trendline support dating back to September 2015. This coincides with the $0.7016 level, which is the November low. Given the long lower shadows and doji candle posted overnight, there is clearly some indecision in play here.

With that in mind, there is a good chance we could see some sort of bullish reaction at these levels. Given that we have not seen any bullish reversal signs yet, the downtrend remains the most sensible play.

Yet should we see an hourly close back above $0.7086 then this could be the cue to become more bullish. But for now, the bearish view remains, with support at $0.7016, $0.7000 and $0.6938. Alternately, resistance is likely at $0.7086, $0.7097 and $0.7159.

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