EUR/USD, GBP/USD and AUD/USD ease back, yet for how long?
EUR/USD, GBP/USD and AUD/USD start to ease lower, yet it is likely that GBP/USD will soon outperform once again.
EUR/USD pause could herald start of next bearish phase
EUR/USD has been in consolidation mode since the Monday leg higher, with the price rotating around the $1.1073 level.
For the most part this recent rally looks like a retracement of the $1.1176 decline, highlighting the possibility that this could be a precursor to a bearish turn. However, we should look for a break below $1.1062 to bring about a more bearish picture. Until that happens, further short-term upside remains the likeliest eventuality.
GBP/USD eases back, yet recent rally paves way for further upside
GBP/USD has similarly been on the decline since Monday’s peak, with the prospect of an election debate denting confidence for the pound.
That event largely went off without any noticeable winner, paving the way for a continuation of the trend seen prior to that debate. With the price having tentatively broken through the $1.2976 level, there is a strong chance that the current pullback is a retracement of the rally from $1.2769. However, that leaves the potential for further downside over the near term as the pair starts to build momentum for the next leg higher.
AUD/USD rebound unlikely to last
AUD/USD has been attempting to regain ground over the past week, with the pair now creating higher highs and lows.
The wider bearish picture came about via a trendline reversal and double top formation. That trend is likely to come back into play before long, with the current rise likely to be a retracement before we turn lower once more. As such, further upside does remain a distinct possibility for the short term, yet a break below the most recent swing low would provide us with a good reversal signal. That breakdown level is currently $0.6785.
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