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EUR/USD and GBP/USD hold support as USD/JPY breaks higher

The euro and sterling are under pressure against the dollar, while the greenback rallies against the yen.

EUR/USD holds support and targets recent highs

EUR/USD has bounced from $1.078 again, as it did last week. It will be interesting to see if the pair can move above $1.088; rallies towards this level on 5 and 8 May became selling opportunities so buyers need to clear this to develop a longer-term move to the upside.

A drop below $1.078 opens the path to a bigger decline, although the late-April low at $1.073 might provide some hope of another holding action on the part of the bulls.

GBP/USD fights to hold $1.23

Here, too, GBP/USD is fighting to hold support for the second time in a week. In this case, $1.23 is the level to watch while bounces towards $1.24 would bring trendline resistance into play.

Near-term support levels to watch are $1.225 and $1.219, as the buyers attempt to stem any further downside.

USD/JPY builds on breakout

USD/JPY has staged a breakout from the bullish wedge in place since the beginning of April. This brings ¥111.00 into view, the highs from late March.

The more bullish view remains in place unless the price reverses back below ¥106.50.

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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