As we move through the fourth quarter, the foreign exchange market is presenting a landscape of clear divergence. While some currency pairs are locked in tight ranges, others are showing strong directional momentum.
For traders at JDR Securities, understanding the key technical levels and chart patterns is crucial to navigating this environment. Today, we’ll break down the setups for three key pairs: EUR/USD, GBP/USD, and AUD/USD.
EUR/USD: Stalling at Key Resistance
The Euro’s technical picture is best described as neutral to bearish. The pair has run into a significant wall of resistance and is struggling to push higher, suggesting that sellers are currently in control. This makes it a critical pair to watch, as a rejection here could signal a deeper move to the downside.
Key Resistance: The most critical zone for sellers is between 1.1631 and 1.1646. This area represents the neckline of a previous reversal pattern and is proving to be a formidable barrier. Further resistance is located at the 1.1686 Fibonacci level.
Key Support: If the resistance holds, the primary downside target is the 100-day Exponential Moving Average (EMA), located near 1.1580.
Outlook: The path of least resistance appears to be sideways to lower. Rallies into the 1.1646-1.1686 resistance zone are likely to attract selling interest until a decisive breakout above this area occurs.
GBP/USD: Bullish Breakout in Play
In stark contrast to the Euro, the British Pound is showing significant technical strength. The pair has recently broken out of a classic bullish reversal pattern, signaling a clear shift in momentum from sellers to buyers. This makes GBP/USD a technically attractive instrument for those looking for U.S. Dollar weakness.
Key Resistance: The main upside target is 1.3516, which is a significant volume level from September. A clean break above this price would open the door for a more substantial rally toward the 2025 highs around the 1.3800 level.
Key Support: The weekly pivot point at 1.3381 now acts as the first important level of support for the new uptrend. Below that, the next key support zone is at 1.3328.
Outlook: The bias is bullish. Traders may view dips towards the 1.3381 support level as potential buying opportunities, with an initial target of the 1.3516 resistance.
AUD/USD: Neutral and Range-Bound
The Australian Dollar’s technical posture is largely neutral, reflecting a market in equilibrium. While the pair has shown some positive signs by reclaiming its 200-day moving average, it has not yet generated enough momentum to break out of its recent range. This suggests a “wait-and-see” approach may be prudent.
Key Resistance: The primary ceiling for the pair remains the highs set earlier in 2025.
Key Support: The 0.6600 area is the most significant support level to watch on the downside, with the 200-day EMA also providing a floor for now.
Outlook: The pair lacks a strong directional bias, making it more suitable for range-trading strategies. A breakout above the 2025 highs or below the 0.6600 support would be needed to signal the next directional trend.
