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Dollar on the rise for EUR/USD, GBP/USD and USD/JPY

Dollar gains ground, as haven demand sees the green back gain traction in EUR/USD, GBP/USD, and USD/JPY.

EUR/USD easing back as risk aversion helps the dollar

EUR/USD weakening after a positive Friday session, with early declines in stocks today bringing upside for the dollar.

The question from here is whether we break the $1.1787 support level to bring expectations of a wider decline to retracement the $1.1688-$1.188 move. As such, while the recent bullish trend remains intact, there is a good chance we could see further downside if price breaks below $1.1787.

GBP/USD pulls back into Fibonacci support

GBP/USD has similarly been under pressure in early trade, with the pair moving back into a confluence of Fibonacci and trendline support.

Given the recent uptrend, we would need to see a break below the $1.2861 support level to bring a more confident bearish outlook. Until then, there is a good chance we could see the pair turn higher once again as traders straddle the hope of a Brexit breakthrough with haven demand as Covid-19 cases rise.

USD/JPY resurgence unlikely to last

USD/JPY is on the rise, following a period of downside which completed a bearish head and shoulders formation. That break below ¥105.03 support provides a clear bearish signal within a wider long-term downtrend.

With that in mind, the current rise looks likely to falter once again. As such, while we could see further short-term upside, a deeper retracement would provide a better selling opportunity. That bearish outlook remains in place unless we see a rise through ¥105.74.

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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