EUR/USD and GBP/USD hit Fibonacci resistance, as USD/JPY heads lower
Dollar weakness brings EUR/USD, GBP/USD and USD/JPY into key levels. The ability to hold or break those levels will be crucial in determining where we go in the days ahead.
EUR/USD rallies into Fibonacci resistance
EUR/USD has continued Friday's gains this morning, with the pair rising into the 76.4% Fibonacci retracement level at $1.0856.
This is the first overbought signal we have seen in the stochastic for two weeks, and that is unlikely to last. Given the current respect at that resistance level, a bearish reversal looks likely from here, with a break through $1.0896 required to negate this bearish outlook.
GBP/USD likely to roll over after early gains
GBP/USD has similarly managed to surge into the 76.4% Fibonacci resistance level at $1.2457.
That signals a likely bearish reversal coming into play from here, with a break through $1.2522 required to bring about a heightened chance of continued bullish price action. Until then, this looks like a good opportunity to look for the bears to come back into play.
USD/JPY heads into key support
USD/JPY has broken from its consolidation this morning, with the price heading into the key ¥106.92 support level.
That looks likely to be the most important level to watch today, with a break below providing a renewed bearish outlook. Given the respect seen over the last month, there is no given that this will be broken. As such, the reaction to this level should guide us as we move forward into the week.
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