EUR/USD, GBP/USD and AUD/USD weaken, with risk of further downside to come
EUR/USD, GBP/USD and AUD/USD head lower as the dollar strengthens, with risk of further downside to come.
EUR/USD continues to trend lower
EUR/USD slipped into a fresh 16-month low on Friday, following on from the retracement phase seen earlier in the week. With a clear downtrend in play here, there was always a strong chance we could see the bears come back into play before long.
With the price having now broken through support, the bullish crossover seen on the stochastic does point towards some potential short-term respite from this selloff. As such, there is a risk of an upward turn before long, but any such move higher would be deemed a selling opportunity unless the price breaks up through the latest swing-high of $1.1374.
GBP/USD turning lower from Fibonacci resistance
GBP/USD has been on the back foot following a rally into the 61.8% Fibonacci resistance level at $1.351.
With the price turning lower since, a break below the $1.3396 level would bring a bearish continuation signal. Until then, there is also a chance we see the price turn upwards to continue the intraday recovery that has been playing out over the course of the past week.
AUD/USD continues to trend lower despite wider bullish trend
AUD/USD has continued to trend lower over the course of the past three weeks, with the price appearing to trade within a falling wedge formation.
The wider trend of higher lows does signal the potential for a bullish resurgence, but the recent selloff does raise the risk of a bearish break below the $0.717 support level. As such, there are stories on both sides of the coin here, with a chance we see the bulls come back into play until $0.717 is broken. A move up through the likes of $0.7291 and $0.737 would be needed to build a stronger case for such a bullish resurgence.
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