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EUR/USD, GBP/USD, and AUD/USD regain ground from key support

EUR/USD, GBP/USD, and AUD/USD start to regain ground, but will this mark the end of the recent phase of weakness?

EUR/USD rebounds from key support

EUR/USD has been on the rise after last week’s decline took the pair back into the notable $1.2059 support level. With the price fighting back, the key here is whether we see price break through the $1.2177 swing high.

With the stochastic starting to roll over within overbought territory, there is still a risk we could continue this intraday trend of lower highs by reversing lower before long. However, with a wider uptrend in play and price approaching the first notable swing high, a continuation of this recovery could soon provide us with a break that negates much of the bearish sentiment built over the past week.

GBP/USD recovers from Fibonacci support

GBP/USD has managed to regain much of its lost ground following a decline into the 76.4% Fibonacci support level. The wider uptrend always remained intact unless the price broken through the $1.3451 support level, and thus it is likely we will ultimately break up through the prior high of $1.371.

With the price starting to lose traction this current candle, a stochastic break back below the 80 threshold could bring doubts over whether this straight-line recovery is going to continue. Nevertheless, with the uptrend remaining intact, the continued trend of higher lows does ultimately point towards further gains to come.

AUD/USD making slow progress after finding support

AUD/USD similarly managed to find support on a key swing low, with the pair turning higher off the $0.7666 level. However, we are not out the woods yet, with the recent trend of lower highs providing a warning sign that this could be another retracement. A break up through $0.7805 would bring about a more reliable bullish continuation signal for the pair.

However, until then it is worthwhile being cautious around these $0.7749 and $0.7771 Fibonacci resistance levels. To the downside, the fact that we have not yet broken out of this bullish trend means it makes sense to watch for a breakdown below $0.7659 before looking for bearish positions.

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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