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

Sterling’s week has got off to a busy start, while the euro looks to be at risk of running out of upward momentum.

Pound coins and dollar note
Source: Bloomberg

All eyes on GBP/USD at the open

The week is barely a few hours old and already the pound has been the subject of much attention ahead of the prime minister’s speech tomorrow. The early gap down has not been met with fresh selling, so the $1.2023 level is the one to watch for the time being.

A close below here is likely to head towards $1.1905 and then $1.1772. Any rally needs to move above $1.2180, but this will largely depend on the content of tomorrow’s speech. 

EUR/USD rally may be at an end

Sojourns above $1.06 have been brief, and it may be the rally from the December lows is running out of steam. Bulls need a close back above $1.0680, and then a push above $1.07, while a bearish move may be in play if the price falls below $1.0523.

Significant support is possible at $1.0450, and then on down to $1.0360. 

USD/JPY looking to the downside

Early trading saw the price explore the area below ¥114, as it did last Thursday, so we still expect rallies to be sold, unless bulls can post a daily close above ¥115.25.

Further downside targets lie at ¥112.98 and then ¥111.47. A close above ¥115.25 would point us towards ¥116.76 and then back to ¥118. 

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