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

The dollar has been tentatively gaining ground, with EUR/USD and GBP/USD both losing ground in the short term. However, with the trend clearly defined, we are likely to see the dollar fall back once more soon enough.

EUR/USD falling below trendline and Fibonacci support

EUR/USD has been turning lower overnight, with the price selling off the back of a resolution to the US government shutdown.

That has taken us down past the confluence of the 76.4% retracement and ascending trendline support. The ability to maintain above the $1.2223 level is going to be key from here, with a fall below providing a somewhat more bearish outlook for the short term. Until then, the recent creation of higher highs and higher lows points towards a strong possibility of a move higher before long. 

GBP/USD falls into near-term support

GBP/USD is moving lower, following the recent rise for the pair. This has brought the price into the previous high of $1.3943, which is certainly a notable support level worth watching out for.

This recent weakness is expected to be a short-term affair, with trendline support coming into play should we break below $1.3943. Whether we do see that deeper retracement or not, a bullish wider view remains unless the price falls below $1.3838.

USD/JPY falling into key support

USD/JPY attempted to regain ground yesterday, yet with the Bank of Japan (BoJ) rate decision overnight, we have seen yen strength return.

This has started to drag the pair closer to the 76.4% retracement at the ¥110.50 support level. A break below there would point towards a potential resumption of the wider bearish trend, with ¥110.19 representing the key support level to break as confirmation. Until we fall past the 76.4%, there is a chance we could see buyers come in once more.

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

This information/research prepared by IGA or IG Group is intended for general circulation. 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 or 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. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.

Find articles by writer

Find out more about