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. 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.

EUR/USD finally bounces as GBP/USD is lifted by rate hike hopes

The euro has found the strength to rally against the dollar, and sterling continues to gain on expectations of a potential BoE rate hike. Meanwhile USD/JPY has drifted lower after.

EUR/USD finally stages a rebound

A more substantial bounce appears to be in play here with EUR/USD, as the price leaps back above $1.16.

A snap-back rally to at least the 50-day simple moving average (SMA) at $1.1715 seems likely, a counter to the losses of September and October, but any bounce that falters below $1.19 will create a lower high and could simply embolden the sellers once more.

GBP/USD still climbing

Similarly here with GBP/USD, the buyers have it all their own way for now but will need to clear $1.39 to avoid a similar lower high.

It has been a strong bounce, fuelled now by expectations of a Bank of England (BoE) rate hike, but sellers will be looking for a price reversal that breaks the recent run of higher lows and renews the downtrend of the last few months.

USD/JPY edges lower

A drift back from Monday’s high is still in progress,with USD/JPY although it puts only a small dent in the gains made.

Overall the buyers still hold sway, and it will take a dip back below ¥113.00 to suggest something bigger is at hand.

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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