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

With the US on holiday, we might be due a respite from the dollar strength that has dominated markets over the past couple of weeks.

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

GBP/USD rides sharp drop

Despite a sharp drop yesterday following US durable goods, the pair has managed to hold above $1.24 for the time being. So far the pair has yet to make a real attempt to break below $1.23.

A close below here would open the way to $1.21. If the price rallies to $1.25 then it may push on to key resistance at $1.2557 and then on towards $1.27.

EUR/USD slumps to December 2015 lows

Yesterday’s slump took the pair to its lowest level since December 2015, testing the $1.0525 support zone.

For now it is holding above this level, but bulls need to get the price back above $1.06 to suggest a bottom is in place.

Below $1.05 the price could move swiftly to $1.0130.

AUD/USD may test 200-hour SMA

Dollar strength yesterday knocked the Aussie back from above $0.74, but crucially it has stabilised well above the low of 21 November around $0.73.

If the price can hold above $0.7350 then a test of the $0.7450 area, near the 200-hour simple moving average, is possible, and this might lead to fresh gains towards $0.75.

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