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

A bullish GBP/USD, unresolved EUR/USD and bearish AUD/USD show a mixed FX market after Trump’s tax plans fell flat.

Dollar and pound
Source: Bloomberg

EUR/USD pushing higher after pullback

EUR/USD is back in the ascendancy this morning, coming off the back of a moderate pullback yesterday morning. We have seen the pair move higher since, as it seeks to follow the gains seen in the wake of the French election.

A break back above $1.0951 would give us the confirmation that we are going to see this uptrend persist. Given that we have broken above $1.0906, the wider uptrend remains in play, which means we could see a decent pullback of the $1.0569-$1.0951 rally. A break below $1.0855 would provide a warning sign that we could move into retracement mode.

GBP/USD rallies into new six-month high

GBP/USD has pushed temporarily through last week’s high of $1.2908, following a gradual continuation of the snap election strength.

The ability to post an hourly close above $1.2908 would be key to providing a signal of further upside to come. It does look like we should have further upside in the tank for this pair, with a break below $1.2756 required to negate the bullish outlook.

AUD/USD turning lower from resistance

AUD/USD is turning lower this morning, following a rally into the last week’s low of $0.7491. The fact that we saw the pair manage to break back below the $0.7491 support level yesterday was crucial in providing a resumption of the bearish view instigated in mid-April (when the $0.7491 double top neckline was broken).

With that in mind, we could see significant downside, yet an hourly close below $0.7455 would be a sensible bearish signal to await to negate the potential of a bigger upside retracement.

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.