EURUSD turned more vulnerable following a break below the 20-week SMA that arrives just below the 1.2000 figure
EURUSD struggles for direction on Wednesday following yesterday’s plunge triggered by massive risk aversion that fueled the safe-haven dollar demand. The pair derived support from the 1.1800 area but encountered intermediate resistance around 1.1835, a break above which would pave the way towards 1.1880, followed by the 1.1900 barrier. On the four-hour charts, the pair looks directionless as well as the RSI, suggesting the prices could see further consolidation before deciding on a fresh direction. In a wider picture, EURUSD turned more vulnerable following a break below the 20-week SMA that arrives just below the 1.2000 figure. A break below 1.1800 would add to a downbeat technical picture in the short term.
The cable managed to get back above the 1.3800 figure on Wednesday to extend the recovery to the 1.3825 region in recent trading. If the pair manages to overcome this local barrier, the next target around 1.3855 will come back into market focus while the key short-term barrier arrives at 1.3900. On the hourly charts, the pound regained the 100-DMA while the RSI turned directionless, suggesting the immediate technical outlook is neutral for the time being. In general, both upside and downside risks look limited at this stage. However, if dollar demand reemerges any time soon, the prices could easily get back below 1.3800.
USDJPY dipped to nearly two-week lows around 110.40 earlier on Wednesday but managed to reverse losses and regained the 20-DMA, today at 110.50. The pair was last seen changing hands in the 110.70 zone, up 0.11% for the day. Now, the greenback needs to retarget the 111.00 barrier that capped gains yesterday. A decisive break above this hurdle would long-term highs around 111.65 back into market focus. On the downside, the 20-DMA represents the immediate support, followed by the mentioned lows in the 110.40 area. On the four-hour charts, the pair is stuck between the key moving averages while the RSI signals a lack of upside momentum in the short term.
The bullion has been rallying for the sixth day in a row on Wednesday. The XAUUSD pair has settled marginally above the $1,800 figure but refrains from challenging yesterday’s highs seen around $1,815, suggesting the precious metal could be already losing its bullish momentum. However, on the positive side, the daily RSI is pointing north while the prices have settled above the descending 20-DMA, suggesting the bullion could at least stay afloat in the near term. In the longer run, the technical outlook for gold remains constructive, with the $1,900 barrier remaining in market focus. A decisive break above $1,815 would pave the way towards the 200-DMA, today at $1,828.
The cross slipped to two-week lows around 130.50 earlier in the day before reversing losses during the European hours. The pair turned positive for the day but still well off yesterday’s peaks at 131.85. During the recovery, the euro faced resistance represented by the ascending 100-DMA in the 131.00 area that now represents the immediate target for bulls. Despite the bounce, it looks like EURJPY would lack upside momentum to extend the bounce in the short term as the common currency stays on the defensive in general. On the downside, the nearest support is now expected at 130.75, followed by the 130.50 area.