FX levels to watch: GBP/USD, EUR/USD and USD/CAD

Recent EUR/USD and GBP/USD gains are unlikely to hold, while a retracement in USD/CAD provides us with a strong buying opportunity.

GBP/USD drifting lower after recent rebound

GBP/USD managed to rebound yesterday after a series of positive events raised hopes that the Brexit proposal is gaining credibility. For the near term we have the EU summit on the weekend to concern ourselves with. We are seeing the pair drift lower and there is no guarantee that we are finished with the retracement.

However, it looks likely that this is a retracement of the $1.3072-$1.2724 sell-off. As such, we look likely to see further downside, yet a break below $1.2764 would be required to signal that the next leg lower is upon us. Until then, there is a chance that this current drift lower is going to be greeted by another rebound. Such a move could be sparked by EU approval on Sunday.

EUR/USD breaking below trendline support

Weaker eurozone purchasing managers index (PMI) surveys are helping drive the EUR/USD pair lower, following a reversal from trendline resistance earlier in the week.

The wider downtrend remains in play unless we see a break through the $1.1500 mark. As such, watch for another breakdown from here, with a fall below $1.1358 adding greater confidence of a move back into the $1.1216 mark.

USD/CAD turning higher after fall into channel support

USD/CAD has dropped overnight, following a rally into trendline resistance earlier in the week.

This provides us with a buying opportunity as we seek to play on the relatively consistent trend in play over the past two months. With that in mind, a rebound is expected, with a fall below the $1.3127 mark required to negate that bullish view.

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