FX snapshot

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

GBP/USD
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. 

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