Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70.04% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money.
English
Regional settings
Entity•Capital Com UK LimitedAuthorised and regulated by the Financial Conduct Authority (FCA)
Why Capital.com?
About us
Our history
Our offices
Leadership team
Client funds
How Capital.com makes money
Contact us
Terms and policies
Ways to trade
CFD trading
Spread betting
1X
Charges and fees
Professional
Margin Calls
Markets
Shares
Forex
Indices
Commodities
Trading platforms 
Web platform
Mobile apps
MT4
TradingView
Demo
Learn to trade
Essentials of trading
Risk-management guide
Market guides
Trading Strategies
Trading Psychology
Technical analysis
Market analysis
Help
My account

HomeMarket analysisForex Majors Test Key Levels

Forex Majors Test Key Levels

By Capital.com news

The US dollar has shown signs of strength in recent trading sessions, buoyed by encouraging developments in the US manufacturing sector. Specifically, the dollar's rise comes on the heels of news that the US manufacturing industry expanded in March for the first time since September 2022.

The resurgence in US manufacturing is particularly significant given its substantial contribution to the overall economy, accounting for 10.4% of GDP. The end of 16 consecutive months of contraction in manufacturing activity underscores a shift in trajectory, potentially signalling broader economic recovery.

Monday's momentum in manufacturing, coupled with Friday's report of easing US prices, has prompted a recalibration of market expectations regarding a potential rate cut in June. This adjustment has propelled the greenback to key levels against several major currency counterparts, reflecting renewed confidence in the US economic outlook.

EUR/USD

EUR/USD has descended towards a critical support zone, which has been established by the swing lows of December 2023 and February 2024. This support zone aligns with the 61.8% Fibonacci retracement level of the rally observed between October and December 2023.

If the market shapes a bullish reversal pattern, such as a double bottom formation, a bullish engulfing candlestick pattern, or a fakeout candle where the market breaches the support level momentarily before rebounding above it, potential buying opportunities may emerge for traders focusing on reversals.

EUR/USD Daily Candle Chart

(Past performance is not a reliable indicator of future results)

GBP/USD

GBP/USD’s market structure has been rangebound since mid-December 2023. Having failed to break above the top of the range in March, GBP/USD has retreated towards the bottom of the range – creating a potential buying opportunity for reversal traders looking to play the range.

GBP/USD Daily Candle Chart

(Past performance is not a reliable indicator of future results)

USD/JPY

Among major forex pairs, USD/JPY stands out significantly as the pair approaches levels not witnessed since 1990. This critical resistance level potentially signals a trigger for intervention by the Bank of Japan. Finance Minister Shunichi Suzuki and top currency official Masato Kanda have recently reiterated the government's readiness to implement decisive measures to tackle excessive currency fluctuations.

As USD/JPY hovers below this pivotal threshold, traders must consider the heightened risks linked to substantial volatility when central banks intervene in the market.

USD/JPY Daily Candle Chart

(Past performance is not a reliable indicator of future results)

Capital.com is an execution-only brokerage platform and the content provided on the Capital.com website is intended for informational purposes only and should not be regarded as an offer to sell or a solicitation of an offer to buy the products or securities to which it applies. No representation or warranty is given as to the accuracy or completeness of the information provided.
The information provided does not constitute investment advice nor take into account the individual financial circumstances or objectives of any investor. Any information that may be provided relating to past performance is not a reliable indicator of future results or performance.
To the extent permitted by law, in no event shall Capital.com (or any affiliate or employee) have any liability for any loss arising from the use of the information provided. Any person acting on the information does so entirely at their own risk.
 

Any information which could be construed as “investment research” 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.