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FX levels to watch – EUR/USD, GBP/USD and USD/JPY

The dollar has been regaining ground against the European currencies, while the yen proves one of the few currencies strong enough to gain ground against the greenback.

EUR/USD heading back into key resistance zone

Following a strong move lower last week, EUR/USD has managed to regain some composure.

That break below $1.2205 completed a wider double top formation, with further downside looking likely. However, with the price approaching the $1.2455 swing high, there is a chance we could see a 61.8-76.4% retracement ($1.2402-$1.2461). With trendline support and the $1.2455 level, the ability to break and hold above that resistance zone will be key to determining whether we will see further upside over the near term or not.

GBP/USD regaining ground after sell-off

GBP/USD fell below the key $1.3764 swing low last week, bringing a wider bearish view.

While this points towards further downside, there is a good chance we are seeing a retracement before the pair moves lower again. Keep an eye out for a break below the latest intraday swing low as a bearish signal, with $1.3756 the current level to watch. Until that is broken, further short-term gains seem likely.

USD/JPY consolidating after support break

USD/JPY broke below ¥105.53 support on Friday, with the price hitting a 15-month low.

This points towards further downside, yet with the price consolidating, it makes sense to await an hourly close below ¥105.24 to signal further downside. Alternately, an hourly close above ¥105.75 would point towards a more protracted retracement to the upside.

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