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

All eyes are on sterling today as the Bank of England meets for its latest policy decision.

All trading involves risk. Losses can exceed deposits.
Euros and dollar notes
Source: Bloomberg

GBP/USD fails to break from downtrend

An overnight rally took the pair above $1.3250, but the 100-hour simple moving average ($1.3258) prevented further gains. The pair certainly looks stuck in a downtrend, with the overnight high marking the latest lower high. 

Now we look to see if $1.3150 can be breached to create a new lower low and a path to the $1.3050 area seen at the end of August. Bulls would need to see a push through $1.3280, with the 12/13 Sept peak at $1.3350 the next target to watch for. An attainment of the latter would certainly mark the beginning of a new uptrend.

 

 

EUR/GBP continues its move higher

The uptrend off the lows of 6 September remains intact, with the dip from Tuesday met by furious buying. Support in the early part of today’s session was found around £0.8480. 
A dovish BoE could put more upward momentum into this pair, with a target of £0.8540 in the first instance. A drop through £0.8460 could raise the possibility that the move higher has reversed course.

 

USD/CAD pushes to July high

This pair offers another great trend, if it is rather steep at present. The price showed distinct reluctance to stay below C$1.3150, but with the August and September peaks now exceeded, the target to watch is the July high at C$1.3255. 
With the price overbought intraday we may see some weakness, but it would need a firm move below C$1.3150 to suggest a new downtrend is beginning. 

 

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