The corrective impetus looks limited, suggesting the common currency could resume the ascent after a short-lived consolidation
EURUSD
As risk sentiment has deteriorated on Friday, EURUSD failed to extend yesterday’s rally and entered the red territory after peaking at 1.2162 earlier in the day. On the other hand, the corrective impetus looks limited, suggesting the common currency could resume the ascent after a short-lived consolidation with a negative bias. In this scenario, the pair could challenge fresh long-term highs and target the 1.2200 next psychological barrier. In case of a deeper correction, the euro would get under the 1.2100 figure. A daily close will determine the picture on the weekly charts as EURUSD is flat on the weekly timeframes where the overall technical picture remains constructive.
GBPUSD extends yesterday’s losses on Friday, staying under pressure amid the persisting Brexit uncertainty. The pound suffers decent losses despite dollar weakness as risks of a no-deal outcome weighing on traders’ sentiment. Earlier in the day, the pair dipped under the 20-DMA and derailed the 1.3200 handle for the first time since November 19. The fact that the 20-DMA turned into resistance and the prices got under 1.3200 point to further deterioration in the short-term technical picture. In the longer run, however, upside risks continue to persist despite GBPUSD is finishing the week on a downbeat note. If the pressure intensifies, the 100-DMA marginally above 1.3100 will come back into market focus for the first time since early-November.
USDJPY
USDJPY peaked around 104.60 on Thursday but failed to confirm the local breakout and retreated to the flatline by the end of the day. Today. The dollar briefly dipped to one-week lows just below 104.00 and stayed under some selling pressure during the European hours. The fact that a long upper wick was created on the daily charts suggests that the recovery potential is still limited in the short term. Now, the 20-DMA (today at 104.15) remains in market focus as a daily close below it would signal deterioration in the short-term technical picture. On the downside, the immediate support arrives at 103.90.
Gold prices are nearly unchanged on Friday, with the current trading range tightening since a strong rejection from local highs around $1,875. On the downside, the precious metal needs to hold above the $1,820 area in order to avoid another sell-off. In the immediate term, the 20-DMA should turn into support so that to pave the way towards recovery attempts. However, the daily RSI is flat in the neutral territory, suggesting the bullion could spend some more time in a consolidative mode before deciding on a further direction. In the longer term, the technical picture remains bearish as long as the yellow metal remains capped by the 100-DMA in the $1,910 zone.
USDCAD
USDCAD bounced from fresh April 2018 lows seen just above 1.2700 on Thursday and turned marginally positive on the day. Despite the bullish bias, the pair obviously lacks upside momentum to stage a more robust recovery from long-term lows as the overall sentiment surrounding the greenback remains downbeat. In the immediate term, the prices need to overcome the 1.2770 local resistance in order to retarget the 1.2800 handle while the key local barrier arrives at 1.2835 where this week’s highs arrive. As the daily RSI is flirting with the 70 figure and is yet to reenter the neutral territory, oversold conditions suggest there is further room for the upside in the short term while a wider picture remains bearish.
