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.

FX levels to watch: EUR/USD, GBP/USD and AUD/USD

A sharp bounce for the dollar has sent EUR/USD, GBP/USD and AUD/USD lower. However, we are starting to see signs of a rebound to claw back some of yesterday’s move.

EUR/USD rally looks to be over

EUR/USD sold off sharply yesterday, following on the Federal Open Market Committee (FOMC) rate decision. This looks likely to mark the end of the recent rebound, with the wider bearish picture coming back into play. That rebound took us into the zone between the 61.8% and 76.4% retracement levels, with the rising wedge formation ultimately breaking in the expected direction.

We have also seen a break below the closest swing low ($1.1197), bringing about greater confidence that this is the beginning of a more bearish phase. With all that in mind, further downside looks likely before long. A break below yesterday’s low of $1.1187 would bring about a more immediate bearish picture. Until then, we could see a more significant retracement of yesterday’s sharp decline before we turn lower once again. A break through the $1.1265 level would be required to bring a wider bullish outlook.

GBP/USD turning higher once more ahead of BoE

GBP/USD has been regaining ground this week, with a break through trendline resistance being followed up by subsequent gains. Despite yesterday’s sell-off, we are seeing the pair turn higher once more today, as it heads towards a key resistance level.

The $1.3133 level is going to be key for this pair, with a break above that level providing us with a wider bullish picture. For the shorter term, watch for a break through $1.3103 to raise expectations of a challenge of that $1.3133 level. Alternately, a break below $1.23037 would signal a more bearish picture coming into play.

AUD/USD rebounds after sharp decline

AUD/USD saw a sharp decline yesterday, bringing the pair into the 76.4% Fibonacci retracement support level.

We are currently seeing a rebound from that support level and thus there is a good chance we will see further upside over the short term. A break through $0.707 would be required to bring about a wider bullish picture. On the flip side, a break back below $0.7007 would heighten the bearish picture once more.

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.