EUR/USD, GBP/USD and USD/JPY all fall back after US credit downgrade
Risk appetite has been dimmed across FX markets after the downgrade of the US credit rating by Fitch.
EUR/USD drops back below $1.10
Losses have continued to be stemmed around the $1.095 level, as the EUR/USD stabilises after last week’s European Central Bank (ECB) decision.
As the price remains above the 50- and 100-day simple moving average (SMA), a bullish view continues to prevail overall, and a recovery back above $1.105 would mark a bullish development. This might then open the way back to the highs of early July.
A close below $1.09 might then suggest more losses were likely, targeting the lows of early June around $1.067.
GBP/USD pullback continues
Losses continue here, although the overall uptrend is still in place for GBP/USD.
A higher low has yet to form, though a recovery above $1.285 would help to bolster a bullish view. This might then see a fresh move towards the July highs.
Additional losses target the $1.26 level, last seen at the end of June.
USD/JPY drifts back from Tuesday high
Tuesday saw additional upside, although the USD/JPY witnessed some volatility after the Fitch downgrade of the US.
Further gains will target the ¥145.00 highs from late June, with a higher high above this helping to reinforce the bullish view.
Sellers will need to see a drop back below ¥142.00, and then on below ¥141.00, in order to suggest that a move back to ¥138.00.
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