Dollar strength continues to drive EUR/USD, GBP/USD and AUD/USD lower

EUR/USD, GBP/USD and AUD/USD continue to move lower, with bearish trend likely to continue as we close out the week.

Transcript

EUR/USD respects Fibonacci resistance after Wednesday pop

EUR/USD has managed to arrest its declines over the second half of the week, with Wednesday’s consumer price index (CPI) reading providing a rare day of gains.

That move higher brought us into the 76.4% Fibonacci resistance level at $1.1754, which is an initial resistance level to consider. A beak up through the $1.1769 level brings about the potential for a wider retracement of the $1.1908 to $1.1706 move. As such, a bearish view holds, with a rise through $1.1769 pointing towards a greater potential for near-term upside.

GBP/USD continues to move lower after support break

GBP/USD has continued its path lower following the break below $1.3843 on Tuesday.

The break through $1.391 in late July does highlight the strong chance that this current pullback is a short-term move before the price turns upwards once again. However, a bullish signal comes with an exit from this intraday trend of lower highs. Thus, for now, a rise through $1.3888 would bring the bulls back into play. Until then, further downside looks a strong possibility.

AUD/USD at risk of another sell-off as price approaches support

AUD/USD has turned back down towards the key $0.7316 support level, following a 61.8% Fibonacci retracement in the wake of a downside trendline break.

That means we could soon see the wider bearish trend kick in once again, with a break below $0.7316 to $0.7289 signaling a continuation of that negative outlook.

IGA, may distribute information/research produced by its respective foreign affiliates 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.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. 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, and 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.

Please see important Research Disclaimer.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices
liveprices.javascriptrequired
liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

liveprices.javascriptrequired

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.