The USD index keeps trading around fresh 2021 tops as safe-haven demand persists
EURUSD is barely holding above the 1.1800 figure on Thursday as the USD index keeps trading around fresh 2021 tops, with safe-haven demand persisting. Earlier in the week, the pair failed to hold above the 200-DMA that now acts as the immediate upside target around 1.1855. On the four-hour timeframes, the common currency remains depressed well below the ley moving averages, adding to the downbeat technical picture in the short term. If the 1.1800 handle gives up, the next support around 1.1745 will come back into market focus for the first time since November. At the time of writing, the euro was changing hands around the flat-line, just above 1.1800.
GBPUSD refreshed early-February lows before bouncing in recent trading. The cable turned marginally positive on the day, to settle above 1.3700. However, the recovery potential looks limited for the time being as dollar demand remains robust. In other words, the pair could see another sell-off following the recent bounce. In this scenario, the pound may threaten the 100-DMA for the first time since late-October. Today, this moving average arrives at 1.3611. On the hourly charts, GBPUSD recovered above the 20-SMA while the RSI climbed north in the neutral territory, which implies that the pair could make further recovery attempts before erasing gains.
USDJPY is back above the 109.00 figure on Thursday after deriving support from the 108.40 area earlier in the week. The pair climbed to a one-week high of 109.16, struggling to stage a more robust ascent from the mentioned support zone. Of note, the daily RSI is about to enter the overbought territory, suggesting dollar bulls could express a more cautious tone down the road. In case of a retreat, a break below 109.00 would bring the pair back to 108.70, followed by 108.40. On the four-hour timeframes, the RSI reversed south in recent trading, which also implies that the upside potential is limited at the moment.
USDCHF extended gains to the 0.9375 figure for the first time since mid-2020 before retreating to the flat-line in recent trading. The pair retains a relatively steady bullish tone while the daily RSI is yet to enter the overbought conditions, which implies that the dollar could resume the ascent following a local correction. On the downside, the immediate support now arrives at 0.9335, followed by the 0.9300 figure and the ascending 20-SMA, today at 0.9260. as long as USDCHF stays above this moving average, the least path of resistance remains to the upside. The technical picture on the weekly timeframes looks upbeat as well.
The Aussie extended losses to fresh early-February lows around 0.7575 earlier in the day before bouncing into positive territory. As a result, the pair erased most of yesterday’s losses but was stopped by the 100-DMA that is now acting as the immediate resistance. This moving average arrives just above the 0.7600 figure which is the key for bullish continuation in the short term. A daily close above this level would somehow improve the technical outlook. However, in a broader picture, the Australian dollar remains vulnerable to fresh losses as long as the pair stays below the descending 20-DMA, today at 0.7723. On the downside, the key focus is on the mentioned lows, as a break below this area would pave the way towards 2021 lows.