FX levels to watch – EUR/USD, GBP/USD and USD/CAD

Joshua Mahony Analysis

EUR/USD is moving higher, coming off the back of a breakdown. Meanwhile, USD/CAD has rallied out of a wedge pattern, pointing towards further upside to come.

EUR/USD in rebound mode after key breakdown

EUR/USD has managed to bring itself into a more positive short-term setting. The break below $1.1574 points towards a wider breakdown coming into play soon enough.

However, with the price pushing above $1.1610 over the near term, there is now a good chance we are going to post a retracement before we turn lower once again. Look towards the 61.8% retracement as a potential target for this current period of upside.

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GBP/USD consolidates after recent decline

GBP/USD has been consolidating around the $1.2957 breakdown level. The break below that level highlighted a continuation of the wider downtrend.

With that in mind, further losses seem likely, with a break below $1.2920 providing greater confidence that this current consolidation/retracement is over. Otherwise, any short-term upside would be seen as a retracement unless we rally through $1.3173.

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USD/CAD wedge break points to further upside

USD/CAD has broken higher from a falling wedge pattern in play over the past fortnight. The break through $1.3039 signals the start of a short-term rebound.

Overnight consolidation has given us a pennant formation, with a break above $1.3075 resistance pointing towards the next leg higher for the pair. A break below the $1.2962 low from yesterday would negate this bullish outlook.

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About the Author

Joshua Mahony

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Joshua Mahony is a Market Analyst with IG Markets.