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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

EUR/USD, GBP/USD and AUD/USD expected to decline further

EUR/USD, GBP/USD and AUD/USD continue to lose ground, with the EUR/USD double top leading the way lower.

Euro and US dollar Source: Bloomberg

EUR/USD drops below double top neckline

EUR/USD has seen sharp declines over the course of the week, with the pair ultimately breaking below the critical $1.1073 support level.

That completes a double top formation, pointing towards further downside to come. Given the wider long-term downturn seen throughout the past year, this bearish view tallies up with the primary trend. As such, bearish positions are favoured, with a break through the near-term swing high of $1.1093 needed to negate this view.

EUR/USD chart Source: ProRealTime
EUR/USD chart Source: ProRealTime

GBP/USD grinds lower, moving towards key support

GBP/USD has been moving lower for much of the week, in a move which comes off the back of a failed attempt to break through the $1.3012 peak from October.

That inability to break into a new high could be damning for the pair if we do break below the $1.2788 support level. However, for now we simply watch for a continuation of this weakness, with a break through $1.2917 required to bring about a more bullish intraday picture.

GBP/USD chart Source: ProRealTime
GBP/USD chart Source: ProRealTime

AUD/USD showing signs of weakness at key resistance zone

AUD/USD has been consolidating over much of the week, with the price having rallied into a key crossroads of ascending and descending trendline resistance.

While the pair is moving higher this morning, there is a good chance that this is a precursor to further downside. As such, further weakness looks likely unless we see a break through the $0.6928 peak from Tuesday.

AUD/USD chart Source: ProRealTime
AUD/USD chart Source: ProRealTime

This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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