EUR/USD, GBP/USD and USD/JPY turn lower once more
Dollar gains help drive EUR/USD and GBP/USD lower, while USD/JPY weakens as traders favour the Yen as a haven.
EUR/USD heads lower as dollar strength dominates
EUR/USD has dropped back below the $1.1787 support level, following a rally into the deep Fibonacci retracement zone (between the 76.4% and 61.8% level).
With the break below that support level confirming both a short-term lower high and lower low, we look likely to be forming a wider pullback of the $1.1688-$1.1881 rally. A break below that $1.1688 level would ultimately be required to bring about a wider bearish outlook. Until then, watch to see if there is any response to the 76.4% Fibonacci support level ($1.1734) as a sign of a potential impending rebound.
GBP/USD weakening through trendline support
GBP/USD is turning lower once again this morning, with price breaking below trendline support. The recent uptrend does point towards this current pullback being a potential retracement and precursor to us moving higher once again.
It is worthwhile watching for potential support to come into play around $1.2982 and $1.2936 Fibonacci levels. Ultimately, while the dollar resurgence is understandable in the face of sharp stock market declines, we would need to see this pair break the $1.2861 level to bring about a more reliable bearish signal given the recent uptrend.
USD/JPY downtrend continues apace
USD/JPY has been on the slide as expected, with the resurgence seen in the latter part of last week ultimately giving way to another sharp move lower.
That downtrend is likely to persist until we break from this trend of lower highs. As such, a bearish outlook holds unless the pair moves through ¥105.05 resistance.
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