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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.
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 tries to stabilise while USD/JPY and USD/CNH keel over

​​Outlook on EUR/USD, USD/JPY and USD/CNH following eight straight weeks of US dollar gains.

Forex market Source: Bloomberg

​​​EUR/USD continues to trade in 3-month lows

​EUR/USD's descent on weak Euro Zone growth took it to a three-month low at $1.0687 before the cross tried to level out last week. The fact that the US dollar saw an eight-week winning streak - its longest since 2014 - amid rising US rate expectations also pushed the currency pair down.

​A drop through Thursday’s $1.0687 low would eye the May low at $1.0636.

​Minor resistance sits around the $1.0766 August low and along the 200-day simple moving average (SMA) at $1.0826 as well as at the July low at $1.0834.

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

​USD/JPY drops on hawkish BoJ comments

USD/JPY has swiftly come off last week’s 11-month high at ¥147.87 on comments by the governor of the Bank of Japan (BoJ) Kazuo Ueda. He stated that the central bank’s negative rates policy could be ended by the start of 2024 if wage increases were to continue.

​USD/JPY thus slid back to its July-to-September uptrend line at ¥145.98 which offers support. Were it to give way, the June peak at ¥145.07 may be revisited.

​Minor resistance can now be encountered between the mid-to-late August highs at ¥146.56 to ¥146.74 ahead of the 29 August high at ¥147.37.

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

​USD/CNH comes off 11-month high

USD/CNH's rally to its 11-month high at CN¥7.3681 on Friday, close to its October 2022 peak at CN¥7.3773, has been followed by a swift sell-off as Country Garden’s debt extension woes continue and consumer prices inch higher by 0.1% year-on-year (YoY) in August.

​A stronger-than-expected yuan fixing, and comments by China’s central bank in which it said it will take action to correct one-sided moves in its currency whenever needed and that it is confident in keeping the yuan stable, pushed USD/CNH down.

​On Monday morning the cross dipped to CN¥7.292, a fall through which would put the June peak at CN¥7.2856 on the map. Further down the July-to-September uptrend line at CN¥7.267 might also offer support. Minor resistance sits at the 21 August high at CN¥7.3361 ahead of the CN¥7.3497 August peak.

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