EUR/USD, GBP/USD and USD/JPY declines likely to continue
EUR/ USD, GBP/USD and USD/JPY decline, with further downside looking likely.
EUR/USD declines below long-term trendline
EUR/USD saw a sharp leg lower on Wednesday, with the pair declining below a key descending trendline of support. That raises the possibility of a wider bearish breakdown for the pair.
With the price on the rise, it looks like we are seeing a retracement, with a break through $1.1162 required to provide a more positive outlook. Until that happens, there is a chance we will see another leg lower before long.
GBP/USD consolidates after latest leg lower
As such, any rebound would likely provide us with a retracement of the $1.2249 decline, with a rally through that peak required to bring about a more bullish picture. Until then, the bears look likely to return before long.
USD/JPY slumps into key support
USD/JPY has turned sharply lower from trendline resistance in the second half of the week, with the yen coming into prominence over recent days. This has taken us into the ¥106.77 support level from late June. Given the sharp declines seen into this area, there is a chance that we could see a rebound over the short term.
It all comes down to how the pair reacts to this support level, with a break below providing a bearish continuation signal. However, with dollar volatility around the corner (non-farm payrolls), continued trade above that ¥106.78 level could provide us with a potential area to rebound from. That being said, given this wider breakdown, further downside looks likely in the end and we simply have to discern whether a rebound is come our way today or not.
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
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.