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GBP/USD, EUR/USD and AUD/USD head lower as dollar weakness takes a breather

GBP/USD, EUR/USD and AUD/USD have drifted lower after recent gains. However, with bullish breakouts in play, further upside looks likely before long.

GBP/USD drifting lower after rally into key resistance level

GBP/USD has been gaining ground over the past week, with the pair moving within touching distance of the key $1.2748 resistance level.

A break through that point would bring about a more bullish outlook for the pair. However, we have since been turning lower, with the price having broken through trendline support. Watch for a break below the $1.2642 support level to provide a bearish confirmation signal. Alternately, a rise above $1.2748 brings a bullish short-term bias.

EUR/USD declines back below notable support level

EUR/USD managed to break through the key $1.1263 resistance level earlier this week, providing a rare higher high for the pair.

That points towards a bullish breakout to come, reflecting the dovish shift from the US Federal Reserve (Fed). That breakout failed to hold, with the provision of a huge inverted hammer pointing towards a pullback coming into play. This looks like a retracement of the rally from $1.1116, and the break below $1.1226 signals a good chance that there will be further to come yet. As such, look out for a break through $1.1306 to provide an immediate bullish outlook. However, until then it looks like we will soon turn lower to provide a deeper retracement before turning higher.

AUD/USD turning higher from support level

AUD/USD is finding support following a pullback into the $0.6962 support level.

That level has provided support in early May, and we are likely to do the same here. With the stochastic rising back above the 20 mark, this looks like an interesting area for the bulls to come in again. Alternately, a break back below $0.6962 would look likely to bring a deeper retracement of the rally from $0.6898.

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