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EUR/GBP heads higher and AUD/USD slumps, while oil weakness boosts USD/CAD

Sterling has struggled against the euro despite the BoE’s rate hike, while the Aussie is under firm pressure against the greenback. The dollar has rallied against its Canadian counterpart.

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​​​EUR/GBP rebounds towards 200-day MA

​The Bank of England’s (BoE) rate hike did not deliver further gains for sterling, and instead the price has rallied sharply with EUR/GBP.

However, this comes after a sharp move lower from late-April, and it is now challenging the £0.8733 support zone as well as the 200-day simple moving average (SMA). A recovery above here might help to reverse the bearish view.

Alternately, a failure to move higher could see further selling momentum develop and result in a fresh test of the £0.866 level seen on Thursday.

EUR/GBP chart Source: ProRealTime
EUR/GBP chart Source: ProRealTime

​AUD/USD slump deepens

​A sharp reversal on Thursday with AUD/USD, accelerated by weakness in commodity prices, seems to have negated any hope of a break higher for now.

Once again a combination of the 100-day SMA and the $0.68 level has knocked back the price after a recovery. A move back to $0.66 could now be in the offing, and might result in a move that breaks this level and leaves the price at risk of a much deeper retracement. The next big level to watch is the October low, down around $0.625.

Bulls will need an impressive recovery that can take out $0.68 as a means of opening the path to further upside.

AUD/USD chart Source: ProRealTime
AUD/USD chart Source: ProRealTime

​USD/CAD heads towards C$1.35

​Oil’s weakness has played a part in rekindling the hopes of a rally here with USD/CAD, after the price dipped towards C$1.33 and hit a one-month low earlier in the week.

The move back above the 200-day SMA helps to suggest the buyers may mount another attempt to put the price back on an upward footing and revive the longer-term trend. This targets C$1.367, and then on to C$1.377.

A reversal below C$1.33 hands the sellers the upper hand once again.

USD/CAD chart Source: ProRealTime
USD/CAD chart Source: ProRealTime

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