Downside risks surrounding the euro look limited at this stage
The dollar attempts to regain ground following yesterday’s losses seen as the 10-year US Treasury yields fell to three-month lows. EURUSD failed to overcome the 20-DMA once again earlier in the day to turn slightly negative in recent trading. If the pressure intensifies any time soon, the pair could challenge the 1.2150 intermediate support. However, downside risks surrounding the euro look limited at this stage. On the upside, the immediate resistance now arrives at 1.2170, followed by the mentioned moving average, today at 1.2190, followed by the 1.2200 key barrier. As long as the common currency stays below this hurdle, the upside potential remains limited as well.
The cable bounced back above the 1.4100 figure on Thursday to finish decently higher. However, the pair failed to preserve gains and retreated marginally ahead of the weekend as the dollar proceeded to recovery. The pound was last seen flirting with the 20-DMA around 1.4055, slightly off intraday lows seen at 1.4140. On the downside, a significant support zone is represented by the 1.4100 level, followed by the 1.4070 area that capped losses yesterday. If the pair manages to hold above the mentioned moving average, a bounce towards the 1.2190-1.4200 region could be expected. However, it looks like the cable could stay under mild selling pressure in the immediate term.
On Thursday, the ascent in USDJPY was capped by the 109.80 area. The pair plunged from local peaks to extend losses to the 109.30 area where the 20-DMA arrives. On Friday, the dollar bounced from this moving average but still lacks momentum to erase yesterday’s losses. The pair was last seen struggling around the 109.50 zone, a break above which would bring the mentioned highs back into market focus. As the greenback attracts selling interest at bullish attempts, it looks like the prices would lack the momentum to see more robust gains in the short term. Meanwhile, on the four-hour charts, the RSI has turned marginally lower in recent trading while the prices are flirting with the 20-SMA, adding to the signs that the recovery potential remains limited for the time being.
Gold prices have been hesitating in a tight range these days while holding mostly above the ascending 20-DMA that arrives around $1,890 today. Earlier in the day, the bullion was rejected from the $1,900 region to turn marginally negative on the day as the dollar regained some ground during the European hours. Still, the precious metal continues to trade around early-2021 highs seen at the start of June around $1,916, with the overall technical picture remaining relatively upbeat despite the prices struggle to make a decisive recovery above the $1,900 barrier at this stage. If the selling pressure intensifies any time soon, a break below the mentioned moving average would pave the way towards yesterday’s lows seen at $1,870.
USDCHF is making modest recovery attempts on Friday, extending a mild bounce from fresh four-month lows seen earlier this week around 0.8925. The pair turned positive during the European hours but lacks upside momentum to stage a more robust rebound at this stage as the greenback looks fragile despite stronger-than-expected US CPI data. The prices peaked at 0.8967, still being capped by a slightly descending 20-DMA, today at 0.8980. The dollar needs to see a decisive recovery above the 0.9000 psychological figure in order to shrug off the downside pressure and regain further ground in the coming days and weeks. So far, however, bearish risks continue to persist.