Skip to content

CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. 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 financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

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

Sterling pairs could see increased volatility today ahead of the Supreme Court ruling, while the Aussie could be at the end of its remarkable run against the US dollar.

Euro coin and sterling note
Source: Bloomberg

EUR/GBP continues to head lower

The pair hit its lowest level since 6 January yesterday, exploring the area below the £0.86 level and creating a new lower low. The direction of travel since last week has been firmly lower, so rallies should continue to be sold, unless the Brexit court news provides a serious disruption.

Given the market is still broadly short sterling this seems unlikely. Instead we look to downside targets at £0.8565 and £0.8534. 

EUR/GBP price chart

AUD/USD rally looks like it may be at an end

The pair’s remarkable rally from the December lows may at last be under threat. The price has hit the inside trendline that goes all the way back into early 2011, and held back progress throughout most of 2016.

A failure to move above $0.76 would indicate the bounce has run its course, and we would look to see if the price can create a new lower low, with a break below $0.75 likely giving a firm indication that more losses are in store.

AUD/USD price chart

USD/CAD falters at 50-day SMA

The price underwent a sharp reversal last week, but faltered at the 50-day simple moving average (C$1.3340). A pullback yesterday encountered support at C$1.3215, and now we look to see if the price can move back above $1.33 and C$1.3350.

A failure to hold C$1.32 would indicate the sellers are back in charge, and could lead to a move back towards C$1.3090 and lower. 

USD/CAD price chart

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

CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

Find articles by writer