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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 – GBP/USD, EUR/USD, USD/JPY

USD strength is dominant across the board, torpedoing a rally in EUR/USD on the back of strong PMI figures. 

Pound coin
Source: Bloomberg

GBP/USD still weak

Weakness continues to be the order of the day in cable, with a rally yesterday towards the 200-hour simple moving average ($1.2480) meeting the same fate as others in the past month.

Now the bears need to get the price below the support zone formed around $1.2350/$1.24, with a move below here potentially opening the way to $1.2280. It would need a move above $1.25 to break the bearish tone, which seems unlikely at present.

GBP/USD price chart

EUR/USD belongs to the dollar for now  

The recovery in EUR/USD last week proved to be a flash in the pan. The price is now back in the downward trend that prevailed from the $1.08 peak at the end of January.

The low from last week lies around $1.0520. Today’s PMI numbers have been encouraging from an economic standpoint, but with dollar strength in the driving seat the currency remains under pressure. A drop below the February low opens the way to $1.0450 and $1.0370.

EUR/USD price chart

USD/JPY going strong

Talk of an earlier rate hike in the US has bolstered the dollar, with the price pushing back above ¥113.

Bulls will now be looking to target ¥114 and then ¥115, while sellers are going to need a drop through last week’s low at ¥112.60, which could target the ¥111.4 low from the beginning of the month. 

USD/JPY price 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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