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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

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

Early dollar strength has provided counter-trend moves this morning. However, with clearly defined trends in place, this could provide a reversal opportunity.

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EUR/USD moving lower in retracement mode

EUR/USD is continuing its descent, following a brief foray above $1.2538 last week.

The current move lower looks likely to continue in the short term, but unless we break below the $1.2205 mark, there is a strong chance we are seeing a retracement. As such, watch out for the Fibonacci levels as potential bullish entry areas.

GBP/USD retracement unlikely to last

GBP/USD is also moving lower, coming off the back of the rally up through $1.4067 last week.

That break points towards an impending resurgence for the pair, with the current move lower simply providing a more advantageous buying opportunity. As long as the price does not fall below $1.3800, a bullish outlook remains in play.

USD/JPY approaching bullish break

USD/JPY has begun trading within the upper half of the Bollinger band, with the 20-hour simple moving average (SMA) providing support rather than resistance.

This is the first time we have seen the pair exhibit this in almost two weeks, providing a potentially bullish short-term view. However, we still remain below the crucial ¥106.86 swing low, so we need a break above that level to confirm the bullish view. But, until that happens, there is still a good chance of the pair turning lower soon enough. 

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