US 10-year Treasury yields back above the 1.60% figure for the first time since the beginning of the week
Dollar demand reemerged on Friday, as US 10-year Treasury yields back above the 1.60% figure for the first time since the beginning of the week. Against this backdrop, the euro erased yesterday’s gains and was threatening the 1.1900 figure at the time of writing. The daily RSI turned back south in the neutral territory, suggesting that there is more room to the downside in the short term. Earlier, bullish attempts were capped by the 1.2000 figure that represents the key hurdle for euro bulls at this stage. On the four-hour charts, the pair has slipped below the 20-SMA, adding to a bearish technical picture. A break below the 1.1900 level would pave the way towards the 1.1870 intermediate support.
GBPUSD turned negative following four days of gains in a row. Still, the pair remains relatively resilient in the face of dollar strength, further flirting with the 20-DMA, today at 1.3950. On the upside, the key short-term barrier arrives at this week’s highs near 1.4000. In the immediate term, the cable will hardly be able to overcome this hurdle. However, the overall technical picture remains upbeat, and the pound could exceed this level following a limited bearish correction that could be capped by the 1.3800 figure, of the 1.3780 region. On the hourly charts, GBPUSD derives support from the 100- and 200-SMAs. If these moving averages withstand the current selling pressure, a bounce could be expected in the near term.
USDJPY extends the rally but still refrains from challenging this week’s high of 109.23. However, the pair was flirting with the 109.00 figure at the time of writing, suggesting the dollar could refresh local tops by the end of the day if the upside pressure persists in the short-term. Of note, USDJPY has settled marginally above the 200-weekly simple moving average, adding to the upbeat technical picture. A daily close above this SMA would be dollar-positive, shifting the market focus to June 2020 highs around 109.70. In case of a bearish correction, the pair will first retreat to 108.80, followed by the 108.50 and 108.30 support zones.
Gold prices climbed to one-week highs on Thursday but failed to preserve the upside momentum and retreated from the $1,740 region. Today, the precious metal extends the correction and was last seen changing hands around the $1,700 figure. A daily close below this level would confirm a bearish technical picture, with upside potential looking limited as long as the bullion remains below the descending 20-DMA, today at $1,750. On the four-hour timeframes, the prices slipped back below the 20-SMA, which implies that further losses could lie ahead in the immediate term.
Following three consecutive days of gains, the Aussie faced resistance represented by the 20-DMA that capped upside momentum and sent the pair lower on Friday. As a result, AUDUSD erased yesterday’s gains during the European hours, to settle around 0.7740 in recent trading. If the selling pressure persists in the near term, the prices could slip towards yesterday’s lows in the 0.7720 area which represents intermediate support on the way towards 0.7700. On the upside, the Australian dollar needs to make a decisive break above the mentioned moving average (today at 0.7783) in order to shrug off the current weakness. As long as the pair stays below this SMA, upside potential remains limited.