FX snapshot – GBP/USD, EUR/USD, AUD/USD, USD/CAD

Yesterday it was the Bank of Canada, today it is the turn of the ECB. FX markets continue to hang on what central banks say, even if risk appetite has recovered slightly. 

Euro
Source: Bloomberg

GBP/USD eyes support at $1.4130

The lows of the week continue to hold, with the question being whether this is a pause or the beginning of a potential consolidation. The 50-hour simple moving average at ($1.4186) continues to cap any upside moves, while so far dips back to $1.4130 continue to find support.

A break above this range heads towards $1.4240 and then $1.4330, the highs from Tuesday’s session.

However, so long as we hold below the 2010 low around $1.4230, the likelihood is that we see further downside towards $1.40, with the 2009 low at $1.35 a possibility in the longer term. 

EUR/USD could drop to month low

Much will depend on Mario Draghi today in terms of near-term direction; the current inability to get above $1.0950 could change rapidly if Mr Draghi opts for a neutral tone.

Dovish talk would put the euro on the back foot, in which case we look to support around $1.0840, with a break below here heading towards $1.08.

Real talk of interest rate cuts, or even an actual move on this, could send the pair back down to the lows for the month of $1.0720. 

AUD/USD could find support at $0.6724

The $0.6960 level stifled gains earlier in the week, and is doing so again, with the pair in retreat.

The $0.6850 mark is the area to watch on the downside, as a break below here ignites a move back in the direction of crisis lows sub $0.65. Some support is possible around $0.6724 and then $0.6621.

A recovery of lost ground today heads towards $0.7017, and then on towards $0.7093.

USD/CAD stuck below 100-hour SMA

For the first time this year, USD/CAD finds itself stuck below the 100-hour simple moving average (C$1.4528).

An attempt to push above it this morning was defeated, and so we look towards the lows of the week around C$1.4420 as possible support.

So long as the pair fails to move back above C$1.4540 then we may see a more sustained move to the downside, giving back some of the recent gains.

Downside targets are found around C$1.4320 and then C$1.4180. 

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