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

The dollar has been strengthening throughout the second half of the week, with the combined effect of the FOMC and ECB seeing EUR/USD, GBP/USD and AUD/USD selling off sharply.

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ECB sends EUR/USD tumbling

EUR/USD has broken lower, following an attempt to push upwards throughout the first week of the month. Even so, this looked like it would have been seen as a retracement before another sell-off.

However, with the European Central Bank (ECB) meeting helping drive EUR/USD lower, there is a good chance that we will not see that protracted rebound come into play. That being said, we would need to see a break below $1.1510 to further this bearish case, and until that happens there is still a chance of a rebound over the short term.

GBP/USD trading near crucial support level

GBP/USD has also seen significant downside come into play towards the back end of the week, with the pair faltering in the wake of the ECB meeting.

This has broken the pair back towards the $1.3204 support level, which will ultimately dictate the state of play for the day. An hourly close below that level would signify a likely further push lower. However, without that break, there is a chance we could start to turn higher as we close out the week.

AUD/USD looks set for protracted period of downside

AUD/USD sold off sharply yesterday, with the pair falling below $0.7475 and out of the uptrend that has been in place since early May.

The wider trend pointed towards further downside coming into play soon enough, and this appears to be the moment that we see such a shift. For the near-term, there is always a risk of a rebound after such an extended sell-off. However, such a bounce would be a selling opportunity, with a bearish outlook in play unless we see a rally through the $0.7624 swing high.

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