EUR/USD starts the year in style, breaking to key resistance. Meanwhile as GBP/USD continues to look bearish, EUR/GBP moves onwards towards a crucial resistance level.

Source: Bloomberg

EUR/USD rallies to key resistance
EUR/USD is rallying heavily this morning, bringing price back to the key resistance level of $1.0944. This level is absolutely crucial as it represents the creation of a new high and thus negates much of the weakness we have seen in the past three trading days.

That said, a closed hourly candle above $1.0944 would certainly be notable and would provide a more bullish slant for the pair. However, until that occurs, we could see this important level cap the upside for now.

Key support levels are at $1.0904, $1.0833 and $1.0808, with resistance levels of note at $1.0944, $1.1000 and $1.1059.

GBP/USD downtrend intact
GBP/USD is also seeing some upside this morning, yet with the continued creation of lower highs and lows, it seems likely that further losses are just around the corner.

The obvious point of another turn lower would be $1.4785, yet as long as it occurs below $1.4849, the bearish view remains intact.

Support levels to watch out for are the $1.4635 and $1.4566.

USD/JPY flushes lower
USD/JPY has dropped heavily this morning, playing into an overall bearish picture that has emerged towards the end of 2015. The current candle is showing some signs of resurgence, yet despite this, further losses seem likely before long.

As such, any rally is seen as a temporary move and bearish signals would be worth watching out for as another move lower could be around the corner.

Key support levels to watch out for are at ¥118.60, ¥118.00 and ¥116.21, with resistance at ¥120.00, ¥120.41 and ¥120.65. Price would need to close back above ¥120.65 to become more bullish.

EUR/GBP approaching key resistance
EUR/GBP has rallied heavily throughout December, with the 50- period simple moving average (SMA) (4-hour) providing continuous support throughout. This morning’s rally appears to be hitting the buffers somewhat, yet the creation of a new intraday high means the uptrend remains intact.

The big question will be asked at the £0.7500 mark, which represents the market top on two occasions in 2015. Until we reach that level, further gains are expected, with £0.7400 the main level of note in between.

The 50-period SMA and £0.7334 represents key support levels.

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