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

The dollar comes under further pressure in both USD/JPY and GBP/USD pairs. Conversely, EUR/USD is moving gradually lower from a triangle pattern.

EUR/USD notes
Source: Bloomberg

EUR/USD breaking lower from triangle pattern

EUR/USD has broken through trendline support this morning, following a failure to create a new high overnight. This could be a bearish short-term sign if it is followed up by an hourly close below $1.1234.

As such, watch out for a bearish short-term signal with an hourly close below $1.1234, while an hourly close above $1.1285 would provide a bullish continuation signal. 

GBP/USD pushes towards Fib resistance

GBP/USD has continued its ascent, with the price moving into the 76.4% resistance around $1.2957. Given the wider downtrend in play, there is a good potential for this Fibonacci level to mark the end of this recent retracement.

Of course, we have the election later this week so it will be a volatile time, but given the wider downtrend we would need a break through $1.3015 to undermine it and point towards further gains.

USD/JPY tumbles once more

USD/JPY moved sharply lower overnight as the risk aversion ahead of Thursday’s upcoming events pushes money into the yen.

Given how extended things are to the downside, it makes sense to wait for the formation of a continuation pattern or retracement. However, further downside does look likely before long.

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.