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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/USD, GBP/USD, USD/JPY

Dollar strength last night has faded somewhat, with good PMI numbers putting new life into cable and EUR/USD. 

JPY notes
Source: Bloomberg

EUR/USD fighting back after Fed meeting

EUR/USD continues to trade in a 100-point range, with purchasing managers index (PMI) numbers this morning helping to put some fight back into the euro after a relatively hawkish Federal Reserve meeting yesterday.

Still, the price will need to clear $1.0950 to ensure further gains. Support is available around $1.0850 and then $1.0830, beyond which we look to the bottom of the April gap higher, at $1.0778.

EUR/USD chart

GBP/USD expecting greater direction

GBP/USD's early weakness this morning has been turned around, while the key services PMI is expected to provide greater direction. The $1.2846 support has been held, so we could see a move back towards $1.2965, the high from the end of April.

Weakness would suggest a test of $41.2846 and then down to $1.2775, which held throughout late April as support.

GBP/USD chart

USD/JPY pushing higher

The Fed meeting last night fired up USD/JPY, pushing it to its highest level since the second-half of March. Now the crunch time is upon us, as the price hits the descending trendline off the January high.

If the price fails to move above ¥113 sellers may return, although the daily chart requires a move above ¥115.50 to create a new higher high. A drop from here would suggest a move back to ¥111.70 and ¥110.

USD/JPY chart

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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.

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