EUR/USD, GBP/USD and USD/JPY driven by dollar weakness ahead of NFP

The dollar heads lower, with EUR/USD, GBP/USD and USD/JPY all being dictated by weakness in the greenback.

EUR/USD continues to regain ground

EUR/USD managed to break through the key $1.0959 level yesterday, bringing about a more bullish short-term view for the pair.

That inverse head and shoulders formation points towards likely upside for now, yet this is most likely a retracement of the decline from $1.1111. With that in mind, further upside looks likely from here, with a rally into the zone between the 61.8% and 76.4% Fibonacci levels looking likely ($1.1021-$1.1055).

GBP/USD breaks resistance to bring more bullish outlook

GBP/USD managed to break through the important $1.2346 level yesterday, negating the short-term downtrend that has been in play.

This makes sense as it conforms with the dollar’s negative view we see elsewhere. As such, we now look for further upside to come into play, with a break below $1.2265 required to bring about a more bearish view.

USD/JPY completes double top formation

USD/JPY managed to break below the critical ¥106.96 support level yesterday, bringing about a completion of the double top formation that has been building.

The wider long-term trend is bearish, and this break points towards a continuation of that primary downtrend. With that in mind, watch out for further downside from here, with a break through the ¥107.30 level required to signal a short-term rebound to retrace that wider decline from ¥108.47. Until then, short-term gains are likely to be sold into.

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