EUR/USD and GBP/USD hold up while USD/JPY falls back following FOMC meeting
FX markets have seen EUR/USD edge back and USD/JPY come under pressure, while GBP/USD has held steady in the wake of a possible agreement between the UK government and its MPs.
EUR/USD turns back towards $1.17
A stronger dollar has pushed EUR/USD back from the highs of the week, but already some buying pressure is coming into play as the price nears the $1.17 area that has marked support since the end of July.
A more bearish view requires a close below this level, while a failure to accomplish this leaves the current range-bound outlook intact. Bulls will want to see a move through the lower high of $1.19 created this week and then back towards $1.20, the peak from the end of August.
GBP/USD still heading higher
News of a possible agreement between the government and rebel members of parliament (MPs) helped GBP/USD move back towards $1.30 yesterday, although we have seen some weakness overnight following the Federal Open Market Committee (FOMC) meeting and a stronger dollar.
However, short-term trendline support from last Friday’s low remains intact for now. Further gains target $1.30 and then $1.304, while a drop back below $1.29 could signal the beginning of a broader bearish view once again.
USD/JPY hit by vague Fed and more optimistic BoJ
USD/JPY found itself in the middle of a tussle between two central banks. The Federal Reserve (Fed) opted not to provide more detail on how its new average inflation targeting (AIT) policy would work, while the Bank of Japan’s (BoJ’s) upgraded economic assessment meant the dollar weakened and the yen rose.
The net effect has been to push the pair through a cluster of support levels to ¥104.80, the lowest level since the end of July. Further declines target ¥104.20 and the lows from the end of July, with the longer-term downtrend having reasserted itself.
This information has been prepared by IG, a trading name of IG Australia Pty Ltd. 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.
Start trading forex today
Trade the largest and most volatile financial market in the world.
- Spreads start at just 0.6 points on EUR/USD
- Analyse market movements with our essential selection of charts
- Speculate from a range of platforms, including on mobile
Live prices on most popular markets
- Forex
- Shares
- Indices
