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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, USD/JPY

Dollar weakness is making itself felt this morning, as the euro soars and the yen begins to see further gains. 

US dollar
Source: Bloomberg

EUR/USD bulls are in charge

In the space of three days EUR/USD has gone from $1.0850 to $1.1027, and so far there is no sign of it stopping. From here we look to $1.1141, and then $1.1279.

The breakout from the late April high seems to confirm that the bulls are in charge, so any retracement should be watched for as a buying opportunity. 

GBP/USD pushes higher

Dollar weakness is helping GBP/USD to move higher once again, although the $1.2950/$1.30 area has held back progress over the past two weeks. Above here $1.3058 and then $1.3427 remain the upside targets.

It would seem futile to become particularly bearish on the pair unless it manages a daily close below $1.2775.

USD/JPY - a turnaround in play?

The rally yesterday petered out below ¥114, creating a new lower high for USD/JPY, but for the time being the ¥113.20 level continues to hold. A move below here would strengthen the case for a continued downtrend on the hourly chart. Further losses would target ¥112.50 and then ¥111.68.

A close back above ¥114 would start to suggest a turnaround is in play, while a close above ¥114.50 would invalidate the bearish hypothesis.

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