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Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% 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.

​​EUR/USD, EUR/GBP and GBP/USD rise amid lower German inflation and UK unemployment

Outlook on EUR/USD, EUR/GBP and GBP/USD ahead of Fed and ECB central bank meetings.

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​​​EUR/USD hits near three-week high

EUR/USD is trading in near three-week highs as German annual inflation was confirmed at a 14-month low of 6.1% in May, down from 7.2% in April.

​Monetary policy meetings by the likes of the US Federal Reserve (Fed) on Wednesday and the European Central Bank (ECB) on Thursday may lead to an increase in volatility in the days ahead.

​Potential upside targets are the $1.0804 mid-February high and the $1.0832 10 April low while Monday’s low at $1.0734 underpins. ​If $1.0734 were to unexpectedly give way, the late May low at $1.0636 would be back in sight.

EUR/USD chart Source: IT-Finance.com
EUR/USD chart Source: IT-Finance.com

EUR/GBP recovers from its ten-month low

​EUR/GBP’s slide to levels last traded in August of last year, to Monday’s £0.8542 low, has been followed by a bullish engulfing pattern on the daily candlestick chart on Monday which points to an interim bottom having been formed.

​As German inflation declined as expected and the UK unemployment rate dropped to 3.8% in April, versus an expected 4.0%, and compared to a previous 3.9% reading, EUR/GBP approached its May-to-June downtrend line at £0.8616 which capped.

​For a lasting bullish reversal to become possible, not only the downtrend line would need to be breached but also the 5 June high at £0.8636 be exceeded. ​Slips should find support around the £0.8568 early June low.

EUR/GBP chart Source: IT-Finance.com
EUR/GBP chart Source: IT-Finance.com

GBP/USD continues to rally post UK unemployment data

GBP/USD is seen heading towards its $1.2599 Monday high as UK unemployment came in lower than expected.

​Above $1.2599 lurks the May peak at $1.2679. This high will remain in focus while Monday’s low at $1.2488 holds on a daily chart closing basis. En route lie the 9 and 11 May highs at $1.264.

​Potential support below $1.2488 is seen along the 55-day simple moving average (SMA) at $1.2466.

GBP/USD chart Source: IT-Finance.com
GBP/USD chart Source: IT-Finance.com

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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