FX levels to watch – EUR/USD, GBP/USD, USD/JPY

A mixed affair for the dollar sees the greenback gain ground against the euro and yen, whilst the pound regains ground following Friday’s credit rating downgrade from Moody’s.

dollar and pound
Source: Bloomberg

EUR/USD falls back after German election

A surprise rise in votes for the Alternative for Germany (AfD) party knocked EUR/USDsomewhat this morning, with a gap lower at the open. However, for the moment we remain within a symmetrical triangle formation, with the creation of lower highs and higher lows.

With that in mind, the current weakness would only translate into a bearish outlook in the event that the price breaks below last week’s low of $1.1861.Until then, we could see the euro come back into prominence as the day goes on.

GBP/USD consolidation continues

GBP/USD has defied Friday’s downgrade from Moody’s, with the market pushing higher from $1.3450 support once again. This keeps us within the range that has been respected over the past week.

As such, this consolidation is expected to continue unless we see a break out of this range.

USD/JPY pushes higher from trendline support

USD/JPY has been pushing higher over recent weeks, as the existence of an ascending trendline helps limit any downside for the time being. This helps provide a bullish outlook, with a break below trendline support and ¥1.1165 is required to negate this current uptrend.

Until then, further upside is expected, with a push towards ¥1.1271 resistance likely before long.

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