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 and AUD/USD drift lower, while GBP/USD consolidates

EUR/USD and AUD/USD continue to lose ground, while political volatility has driven GBP/USD consolidation.

EUR/USD continues to drift lower after head and shoulders breakdown

EUR/USD managed to complete a head and shoulders formation on Tuesday, with the break below $1.181 bringing about a sharp decline for the pair.

We have since seen substantial EUR/USD losses in anticipation of a potential rate cut from the European Central Bank (ECB) today. Given the uncertainty of that event, volatility looks certain. For the near term, a break through the recent swing high of $1.1156 would bring about a signal that we could start to retrace that recent sell-off from $1.1282. Otherwise, a bearish outlook remains in play as the pair continues to create lower intraday highs.

GBP/USD consolidation continues amid uncertain political outlook

The pound has seen a volatile week, with the GBP/USD showing little preference for a bullish or bearish direction.

The current move lower is set within a wider trend of higher lows and lower highs. This is the basic construct of a symmetrical triangle consolidation phase. As such, watch for a break through the first swing high of $1.2558, or swing low of $1.2418, as a gauge of where we go from here.

AUD/USD declines into wider 76.4% retracement level

AUD/USD has continued its declines, with the pair falling below the first swing-low of $0.6996. That points towards a wider retracement coming into play in a similar manner to that seen in early July.

The key question is whether the pair will respect the upcoming 76.4% retracement level at $0.6951. Should that occur then it looks like we are simply retracing before the pair creates another push higher. However, an easy break below $0.6951 would raise the likeliness of a breakdown from this recent uptrend, with a break below $0.6910 providing confirmation of such a bearish shift in tone.

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.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.8 pips on EUR/USD
  • Analyze market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on the most popular forex markets


Prices above are subject to our website terms and agreements. Prices are indicative only

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading forex provider.

Stay on top of upcoming market-moving events with our customisable economic calendar.