EUR/USD, GBP/USD and AUD/USD start to reverse lower after recent bounce
EUR/USD, GBP/USD and AUD/USD show initial signs of a fresh bearish reversal after a period of upside.
EUR/USD starts to roll over after latest pop
EUR/USD has managed to regain a significant amount of ground over the course of October thus far, with the price currently on track to close out the first monthly gain since May. However, despite the rise through parity and the early-October peak, there is a good chance we could see the pair move lower from here.
It is worthwhile noting that the true swing high that needs to break to bring a potential reversal signal is $1.0198. With that resistance level still intact, the bearish trend holds for now. This recent rise has brought a fresh move into overbought on the stochastic, with the current reversal in the price action bringing a likely move back below 80 on the stochastic.
We have only seen that signal three times in 2022 thus far. Each of which soon resulted in another leg lower for the pair. With that in mind, another turn lower looks likely until we see the price rise through $1.0198.
GBP/USD rebound starts to fade
GBP/USD has enjoyed a period of counter-trend upside, with Rishi Sunak’s appointment bringing confidence that we will not see a repeat of Liz Truss’ mistakes.
The price has managed to break up through the trendline $1.1495 resistance, but we remain below the crucial swing high levels of $1.1738 and $1.2277. Greater confidence of a return to the prior lows of $1.0328 comes with a break below $1.106.
However, until we see the likes of $1.1738 broken, there is a good chance that the wider bearish trend kicks in here.
AUD/USD reversing lower after deep retracement
AUD/USD has typically been an underperformer of late, with the Reserve Bank of Australia (RBA) rate hike slowdown bringing further pressure on the Australian dollar.
A break through the $0.6547 swing high would be required to bring a wider retracement into play. However, until that happens there is a good chance we see the bears come back into play from here.
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