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

European currencies are in recovery mode after recent declines, yet GBP/USD looks set for further losses. Meanwhile, USD/CAD is approaching a critical resistance level.

EUR/USD turning higher from trendline support

EUR/USD has started strengthening this morning, after finding support on an ascending trendline overnight. This points towards a likely rally into trendline resistance, with the creation of higher highs and higher lows over the past fortnight looking likely to persist.

The break through the descending trendline on Friday points towards a possible wider resurgence coming into play here, with a break above $1.1500 providing the necessary signal that we are set for a wider bullish period.

GBP/USD in retracement mode after recent declines

GBP/USD has been in a steep decline in the early part of the week, with the price falling into a 19-month low.

This bearish trend is likely to persist despite the current rebound, with these gains instead looking likely to provide a good shorting opportunity. With that in mind, it makes sense to look for shorts as long as the price remains below $1.2812.

USD/CAD rallies towards previous highs

USD/CAD has been rebounding over the early part of the week, with the price moving closer to the previous peak of $1.3445.

The ability to break through that level will provide us with a lot of information, given the recent question marks that come with the break below $1.3182 earlier this month. As such, a break above $1.3445 would provide a continuation signal, yet until that break happens, there is a chance we could fall lower to raise doubts once again.

This information has been prepared by IG, a trading name of IG Markets 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.

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.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% 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.