Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. You could sustain a loss of some or all of your initial investment and should not invest money that you cannot afford to lose. CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

EUR/USD, GBP/USD and AUD/USD move lower in early trading

Losses continue in EUR/USD and AUD/USD, while cable is looking to push on after spiking in Monday’s session.

EUR/USD still in short-term downtrend

Yesterday saw EUR/USD remain under pressure, with the early move higher slowly giving way over the rest of the session.

Further declines below Friday’s low of $1.1016 confirm the downtrend and open the way to the October low of $1.0877. A rebound above $1.104 might help to revive a more bullish view, and might suggest the creation of a higher low on the daily chart.

GBP/USD eases back from Monday spike

Monday witnessed a rally in GBP/USD, as election news drove the price higher.

Some of those gains have been given back, and if further declines push the price below $1.277, then more downside seems likely. If the price can hold above the 50-hour simple moving average (SMA) of $1.2825, then a move back to $1.29 may result. The inability of yesterday’s bounce to hold above $1.286 is a negative development.

AUD/USD heads towards support

AUD/USD has shed some ground over the past two weeks, but it is rapidly heading towards horizontal support at $0.6828 and rising trendline support just below this.

This trendline has held since the beginning of the month, and may provide some support. A close below this and below the 50-day SMA ($0.6816) would be a potentially negative development. However, if the price can hold above it and create a higher low then a fresh push higher may result, targeting $0.693 and the November highs.

This information has been prepared by IG, a trading name of IG US LLC. This material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. You should not treat any opinion expressed in this material as a specific inducement to make any investment or follow any strategy, but only as an expression of opinion. This material does not consider your investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. No representation or warranty is given as to the accuracy or completeness of the above information. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. Any research provided should be considered as promotional and was prepared in accordance with CFTC 1.71 and designed to promote the independence of investment research. See our Summary Conflicts Policy, available on our website.

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