The greenback could see a widespread rally later in the day if Fed’s Powell expresses a hawkish tone
The dollar is back under pressure following a short-lived bounce seen yesterday. EURUSD faced resistance around 1.1780 and has been struggling to regain upside bias since then. The pair is flirting with the flat-line on Friday, struggling for direction ahead of Fed’s Powell speech. On the downside, the immediate support is represented by the 1.1730 area, followed by the 1.1700 figure. As long as the common currency remains above this level, bearish risks are limited. On the hourly charts, EURUSD needs to get back above the 20-SMA in order to turn positive on the day. The RSI on the same timeframes is now pointing slightly higher but looks too fragile to bet on regaining sustained upside momentum at this stage as the greenback could see a widespread rally later in the day if Fed’s Powell expresses a hawkish tone.
The cable dipped to the 1.3680 area earlier in the day before bouncing slightly. The pair has entered positive territory in recent trading but still lacks upside bias and is yet to confirm a recovery above the 1.3700 figure on a daily and weekly closing basis. The daily RSI is painting a neutral technical picture while the 1.3800 figure continues to deter bulls as the 20- and 200-DMAs converge in this zone, representing a strong barrier for sterling bulls. Should the pair come under renewed downside pressure, the mentioned 1.3680 intermediate support could give up. In this scenario, this week’s lows just above the 1.3700 figure will come back into market focus.
USDJPY has been trending higher for the third day in a row on Friday. The pair extended gains to the 110.20 area yesterday to settle just above the 110.00 figure during the European hours ahead of the weekend. Earlier in the day, the prices dipped to intraday lows around 109.90. The 20-DMA (today at 109.80) now represents the immediate support, followed by the 100-DMA that arrives at 109.63. In the short term, the greenback needs to confirm a break above 110.00 on a daily and weekly closing basis in order to see more gains next week. Otherwise, the mentioned moving averages will come into play in the coming days.
Gold prices keep trading within a relatively tight range these days, struggling for direction. The yellow metal closed with marginal gains overnight, and further consolidation should not be ruled out in the short term. On the upside, the $1,810 area remains in focus. In this zone, the 100- and 200-DMAs converge, representing the immediate barrier for buyers. On Friday, the bullion is flirting with the $1,800 psychological level. Of note, the price is approaching a slightly ascending 20-week SMA, extending gains for the third week in a row. Interestingly, this moving average also arrives at $1,1810, strengthening this immediate resistance. As such, the bullion may need a solid driver to overcome this hurdle which could trigger a technical pullback. On the downside, the 20-DMA (today at $1,882) represents the immediate significant support.
USDCHF has lost upside momentum on Friday following two days of gains. The pair peaked at 0.9190 yesterday before correcting slightly lower. The dollar has settled around 0.9175 since then after notching intraday lows in the 0.9155 area earlier in the day. On the positive side, the prices stay above the key simple moving averages. On the other hand, it looks like USDCHF would need an extra catalyst to challenge the 0.9200 barrier in the short term. For the time being, the technical picture looks neutral, with the immediate support arriving at 0.9143 where a slightly ascending 20-DMA lies. As long as the pair stays above this moving average, downside risks are limited.