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FX levels to watch – EUR/USD, GBP/USD, USD/JPY

Dollar weakness continues to aid the euro and sterling, while USD/JPY seems set for further losses. 

Pounds and dollar
Source: Bloomberg

EUR/USD with support at $1.1384

So far this week $1.1384 has acted as support for EUR/USD, preventing further downside, so this is the area the bears need to break, ideally with a close below $1.1366.

An upside move requires a break back above $1.1445, which would give it the strength to test $1.15. 

EUR/USD price chart

GBP/USD at risk of a drop to $1.2911

GBP/USD has broken the descending trendline off the highs from late June, but now we could see a retest of these levels and a drop back towards $1.2911, the 50-period simple moving average (SMA) on the four-hour chart.

Longer-term, the price needs to clear $1.3084, which has been a hurdle before, in May. A move below $1.2825 is needed to restart the downward trend. 

GBP/USD price chart

USD/JPY heading down

The bearish failure to break ¥114.37 earlier in the week continues to set the tone for USD/JPY.

Dips below ¥113 saw buyers, but the inability to move back above ¥113.50 suggests that the next move will be downwards, towards ¥112.75 and lower. 

USD/JPY price chart

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This information has been prepared by IG, a trading name of IG Markets Limited and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.