FX snapshot – US Dollar Index, EUR/USD, GBP/USD, EUR/GBP

EUR/USD weakness pushes the Dollar Index higher, while EUR/GBP sells off strongly once more.

A pound coin atop a euro note
Source: Bloomberg

US Dollar Index trending higher

EUR/USD strength has pushed the Dollar Index higher, with new found support at $97.33. The creation of new highs and higher lows is new expected to continue, with price action confirmed by the stochastic oscillator. As the stochastic turns higher, the price too is expected to push higher, with $97.69 and $98.05 the two near-term resistance levels in view. Any move lower is likely to be capped by $97.33.

EUR/USD weakness expected

Yesterday saw EUR/USD break below key support at $1.1005 to bring about a renewed bearish outlook. A strong trend lower ensued, only to be followed by a period of overnight consolidation. The price is currently seeking to break lower, which I see as the most likely event. The clearest indicator would be a close below $1.0936 which then points towards a move back to $1.0897 and $1.0819 support levels. The bearish view would remain unless the price closes back above $1.0969.

GBP/USD awaiting signal

A very strong selloff yesterday saw the GBP/USD break back to the 200-hour SMA support. However, the recovery since has brought the it back above $1.5415 support. As such, we need to watch for the resolution of the current position, where a closed candle above $1.544 would point towards gains with $1.5467 in sight. Alternately, a close below $1.5412 would bring a high likeliness of a selloff back down towards $1.538.

EUR/GBP downtrend continues

EUR/GBP continues to selloff, with the price breaking below £0.7102 support this morning. A clear downtrend is in play and thus further losses are to be expected. The next key support level in view is £0.7026 as the pair attempts to regain the July low of £0.6936. Near-term resistance levels to watch are £0.7106 and £0.7115.

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.

Find articles by analysts

Find out more about