EUR/USD, GBP/USD, and USD/JPY recovering from recent pullback

EUR/USD, GBP/USD, and USD/JPY push higher following period of short-term declines.

Transcript

EUR/USD attempts to steady itself after latest decline

EUR/USD has been attempting to stabilise itself after yet another phase of weakness that led the pair into a fresh four-month low. The recent decline has taken us into the 76.4% Fibonacci support level at $1.1778, raising questions over whether this could be the beginning of a more protracted move higher.

Thus, we are in fact at a crossroad of a longer-term uptrend and a multi-month downtrend. As such, watch out for a potential rebound over the near term, although we would ultimately need to see a move through $1.1602 or $1.199 to tell us whether we end the wider uptrend or break this recent decline.

GBP/USD on the rise after latest move lower

GBP/USD is on the rise in early trade, with the pair attempting to regain ground following a pullback in the early part of last week. That recent pullback took us into the 76.4% Fibonacci level, raising a smaller scale example of what we are seeing in EUR/USD.

A break below $1.3566 brings a wider bearish picture into play, while a rise through the $1.4006 ends this recent bearish trajectory to resume the long-term uptrend. For now, the mid-sized rebound points towards the potential for a deeper move even if this is only a retracement phase as the dollar bulls take a breather.

USD/JPY pullback finds support on previous breakout level

USD/JPY managed to break through ¥109.36 resistance on Friday, with the pair hitting a fresh nine-month high in the process.

Notably, that rally ended at the key ¥109.85 peak from June 2020. While the pair has pulled back from that resistance level, we have seen 109.36 hold up as new support. As such, there is a good chance we see further upside from here in a bid to continue the uptrend seen over the course of 2021 thus far. A break back below the ¥108.34 low would be required to negate this bullish trend.

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.