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EUR/USD and GBP/USD continue to bounce, while USD/JPY recovers from overnight weakness

The morning has seen early gains for the euro and sterling against the US dollar, while against the yen the greenback is aiming to push higher.

EUR/USD in volatile mood

Monday’s decline was almost as dramatic as the surge on Friday for EUR/USD.

A higher low has been created around $1.11, providing a potentially bullish development. Further gains above $1.112 would target $1.115, beginning to carve out an uptrend. A reversal below $1.107 negates this more bullish view.

GBP/USD still in steady uptrend

The pound has enjoyed an excellent rally over the past three weeks, and shows no sign of stopping yet. Strong buying has seen the price for GBP/USD rally from $1.22, with dip buyers entering and pushing the price upwards.

A move back below $1.22 would be a more bearish development, putting the price below the newest higher low and back below resistance from early August.

USD/JPY pulls back from overnight peak

A sharp rally on Monday was followed up by some profit-taking for USD/JPY, but if the price can find a base around ¥105.60 then a higher low may be created.

Further declines would head towards ¥105.00. If a higher low is created around ¥105.60 then the mid-August peak around ¥106.70 is the next target.

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