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.

USD/JPY on the rise as EUR/USD and GBP/USD fall back

While FX markets are calmer compared to indices, they have seen signs of dollar strength that has helped USD/JPY to rally to a three-week high.

EUR/USD opens below 50-day SMA

EUR/USD fell below the 50-day simple moving average (SMA) at $1.2123, and has continued to fall in early trading.

Further declines below $1.205 will bring the 100-day SMA at $1.1949 into view, and then on towards $1.192, where the price stalled in August. For now the sellers appear to hold sway. This will begin to change if we see a move back above $1.22.

GBP/USD returns to trendline support

The GBP/USD price dropped back once again below $1.37 yesterday, and is now testing trendline support from the early-December lows.

A move below support could spell a drop towards the 50-day SMA at $1.3496, or potentially further, down to $1.347. Should support hold then a bounce back above $1.37 becomes possible.

USD/JPY hits three-week high

The USD/JPY price saw strong gains yesterday, with additional upside this morning that seems to point towards a more extended recovery.

The ¥104.39 high from early January may provide some resistance, but if this is broken further upside seems likely, potentially bringing ¥105.45 into view.

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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