FX snapshot

Risk appetite has recovered overnight, with the euro in particular still looking strong. 

Source: Bloomberg

GBP/USD may push higher
The pound continues to show a reluctance to push much beyond $1.56. Since mid-July the area above $1.5640 tends to result in a stoppage in upward progress, so a daily close above this level is needed before it can be said that bulls have the upper hand once again.

If we do move higher, the targetfor GBP/USD remains the June high above $1.58. Downside support is to be found in the direction of $1.5426, and then towards the 200-day simple moving average at $1.5376.

EUR/USD looks to be turning bullish
The euro has declined overnight, but hourly stochastics seem to be on the verge of a bullish crossover, providing a potential entry point for a move back above $1.12 that could reignite the rally in EUR/USD.

The upside target is still in the direction of $1.14, with the 200-day SMA at $1.1375 also entering the frame. Downside targets lie back towards the August lows around $1.0850, assuming the 50-day SMA at $1.1090 doesn’t hold.

USD/CAD looks to continues its current downtrend
The pair continues to oscillate around the C$1.30 mark, with a move above here generally bullish and targeting the C$1.3140 area.

A move below yesterday’s lows of C$1.2960 would suggest a continuation of the downtrend, with a target of the 50-day SMA at C$1.2708. 

USD/JPY aims for the upside
USD/JPY continues to probe the ¥124 area, but for now the buyers seem to have the upper hand, having rallied off yesterday’s lows.

Upside targets lie around ¥125.20 and then on to ¥126, while a turn lower would see the pair head back towards key support around ¥123.80, and then onwards to the 100-day SMA at ¥122. 

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.