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EUR/USD, GBP/USD and USD/JPY all in retreat

Risk aversion has hit FX markets, with USD/JPY in particular coming under heavy pressure.

EUR/USD rolling over

The EUR/USD pair has come under pressure in early trading, shedding ground as it retreats from $1.185.

Having struggled to make much headway since early August the pair now looks set to test support at $1.175, and then on down towards $1.165. A recovery above $1.19 is needed to provide a more bullish view in the short term.

GBP/USD resumes its decline

The failure to break back above the 50-day simple moving average (SMA) last week will come as a negative development for many, and with a second day of losses in store the question will be how far the GBP/USD pair will decline.

The next area of support could be $1.277, while below this the 200-day SMA at $1.273 comes into view.

USD/JPY hits six-week low

The yen continues to strengthen, and the USD/JPY pair has now returned to the ¥104.00 area that marked support at the end of July.

Bulls will be uncomfortably aware that the next level to the downside is ¥103.00, and from there down to ¥101.20. A rebound above ¥105.00 is needed to provide a foundation for some near-term gains.

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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