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FX levels to watch: EUR/USD, GBP/USD and AUD/USD

Dollar strength is driving EUR/USD, GBP/USD, and AUD/USD lower, with the wider bearish downtrends remaining intact.

IG Analyst

Publication date : 2018-11-12T09:47:11+0000

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EUR/USD breaking lower from 61.8% Fibonacci retracement

EUR/USD is selling off sharply this morning, continuing the weakness seen in the wake of a 61.8% retracement last week. That marks a continuation of the downtrend in play throughout October.

However, we have now come to challenge an important historical inside trendline, which acted as support in the past. Watch out for how the pair reacts to this trendline, with another break lower highlighting a continuation of the bearish trend. However, also be aware that before long we will retrace upwards once again, upon which we can look for another Fibonacci selling opportunity.

EUR/USD chart

EUR/USD chart

EUR/USD chart

GBP/USD tanks after 76.4% retracement

GBP/USD has ramped up the selling, following on from the 76.4% retracement throughout the beginning of November. The failure to break through $1.2661 support in late October did raise some questions over whether we were going to see a retracement or rally through $1.3258.

Much of that was likely to be influenced by the Brexit outlook too, which still remains some way from a resolution (depending on who you ask). For now, it looks likely we will head back down towards the $1.2696 support level, although the extended nature of this move means there is a strong likeliness of a short-term rebound before long.

GBP/USD chart

GBP/USD chart

GBP/USD chart

AUD/USD tumbles into key support level

AUD/USD started reversing lower on Thursday following a very deep upward retracement. However, with the pair having failed to break through the $0.7315 resistance level, the long-term downtrend remains intact.

For a bearish confirmation signal, look out for a break below the $0.7182 swing low. Should that occur, we would likely see a bearish shift back towards the $0.7021 mark before long.

AUD/USD chart

AUD/USD chart

AUD/USD chart

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