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

Short-term dollar weakness has seen EUR/USD, GBP/USD and AUD/USD rally over the past 24 hours. However, there are signs that we could be about to break lower once more.

anonymous

Publication date : 2018-09-13T09:47:45+0100

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EUR/USD consolidates around trendline resistance

EUR/USD has rallied back into the four-hour simple moving average (SMA) resistance overnight, with the pair remaining stuck between the descending trendline resistance and SMA support.

That trendline (dating back to June) is back in play now, and we would need to see a break through $1.1659 to signal an impending period of upside for the pair. As such, watch for a break above $1.1659 or below $1.1570 to provide direction for the near term.

EUR/USD chart

EUR/USD chart

EUR/USD chart

GBP/USD continues to grind higher

GBP/USD has been pushing higher over the past fortnight, with the pair hitting the highest level in a month on Tuesday. However, despite attempting to break through that peak, we have seen the pair fail to overcome this week’s high of $1.3088.

This may not necessarily be a bearish shift, with the creation of higher lows still pointing towards further upside. However, it is worthwhile keeping an eye out for a potential break below the $1.2965 level. Should that occur, there would likely be a period of weakness, if only to retrace part of the $1.2785-$1.3088 rally.

GBP/USD chart

GBP/USD chart

GBP/USD chart

AUD/USD hits Fibonacci resistance

AUD/USD has managed to rebound sharply over the past 24 hours, breaking out of a period of sideways consolidation and into a retracement.

This points towards a good bearish selling opportunity coming into the fray, given the deep retracement we have seen. The almost perfect respect of the 76.4% retracement level ($0.72) points towards a likely period of weakness coming into play from here. A break above $0.7236 would be required to negate this bearish short-term outlook.

AUD/USD chart

AUD/USD chart

AUD/USD chart

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This information has been prepared by IG, a trading name of IG Markets Limited 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. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% 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. Clients can lose more than they deposit. All trading involves risk.

IG is a trading name of IG Markets Ltd and IG Markets South Africa Limited. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in order to utilise their foreign investment allowance should the South African resident wish to open an offshore account with IG Markets Limited.

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