FX levels to watch: EUR/USD, GBP/USD and USD/JPY
EUR/USD and GBP/USD seem poised for further falls after a small recovery, while USD/JPY is attempting to hold Friday’s lows and begin a fresh move higher.
EUR/USD likely to extend declines
Having been rudely knocked back into the descending channel, EUR/USD has seen some buying, but the limited bounce may set the pair up for a selling opportunity, with a renewed push lower below $1.127 targeting $1.118.
A recovery above $1.135 would provide a more bullish view.
GBP/USD quiet ahead of busy week
It promises to be another volatile week for GBP/USD, but sterling is doing its best to rally in early trading against the dollar.
However, it needs to break through to $1.325 to clear the trendline from the 13 March highs. Fresh declines would push towards the key rising trendline support from the January low, around $1.31.
USD/JPY looks to create higher low
USD/JPY suffered a heavy blow last week, but has managed to steady itself around ¥110.00.
If it can bottom out around here then a higher low will have been created, with a move above the 50-day simple moving average (SMA) at ¥110.42 providing a further reinforcement to the bullish view. Below ¥109.57 the price will head towards ¥108.52.
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