FX Levels to Watch – EUR/USD, GBP/USD, USD/JPY

Dollar strength has ebbed somewhat, helping the euro to move higher. Meanwhile, the yen is holding its ground against the greenback.

Source: Bloomberg

EUR/USD steadies for now

Euro bears continue to hold sway here, but after declines for EUR/USD over the past four sessions, they should be on alert for a rebound. Any rally back up to $1.1950 should be treated as a selling opportunity, either to initiate new shorts or add to existing positions.

The $1.17 area is acting as support for now, but below this the 50-day simple moving average (SMA) at $1.1645, comes into play. Overall, the outlook is bearish, and remains so unless we see a recovery above $1.20.

GBP/USD retracement continues

For GBP/USD, the next area of big support comes in at $1.3281, as the price continues its fall from the September highs. The daily uptrend remains intact, and will continue to do so unless the price pushes below $1.30.

Nonetheless, a move below $1.3268 would be a bearish development and raise the possibility of more losses. For now, intraday rallies will likely be sold, as bulls wait for a deeper pullback. 

USD/JPY edges up, but stuck in long-term downtrend

USD/JPY continues to push higher, although it remains far from ending the downtrend that has endured all year. That would require a close above ¥114.37.

For now, dips will continue to be bought, with a move back below ¥111.50 needed to negate the positive outlook for the pair in the short term.

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.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% 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.