The common currency could stay on the defensive in the coming days amid a broader strength surrounding the greenback
The dollar has steadied on Thursday following another rally to fresh peaks. EURUSD found support around 1.1530 to bounce slightly. However, the recovery potential is capped by the 1.1570 area, suggesting the common currency could stay on the defensive in the coming days amid a broader strength surrounding the greenback. If the mentioned lows give up, EURUSD would threaten the 1.1500 figure for the first time since July 2020. On the four-hour timeframes, the technical picture looks neutral, with the 20-SMA capping potential gains. In a wider picture, the euro looks set to finish the fifth bearish week in a row. Furthermore, the prices have settled below the key moving averages on the same charts.
The cable struggled on Thursday despite a slight bullish bias on the intraday timeframes. The pair failed to hold above the 1.3600 figure and has been on the defensive since then. However, the prices managed to come off late-2020 lows seen just above the 1.3400 level last week. The pound was last seen changing hands around 1.3587, up just 0.06% on the day. A sustained recovery above 1.3600 would bring the descending 20-DMA (today at 1.3660) back into the market focus. This moving average has been acting as resistance since mid-September. As the daily RSI looks directionless in the neutral territory, GBPUSD could further struggle below 1.3600 in the near term, with downside risks persisting at this stage.
USDJPY failed to regain the 112.00 figure on Wednesday and has been struggling to resume the ascent since then. Today, the pair has settled around 111.40, nearly unchanged on the day. The immediate support now arrives at 111.20, followed by the 111.00 figure and the 110.80 key zone that capped the bearish momentum earlier in the week. Now, the dollar needs to regain the 111.60 region in order to retarget 112.00. For the time being, it looks like the prices could spend some time in consolidation mode before deciding on the further direction. On the weekly charts, the technical picture remains buoyed, with USDJPY finishing the fifth bullish week in a row.
Gold prices have been struggling around a slightly descending 20-DMA this week. The bullion was rejected from local highs around $1,770 at the beginning of the week and has been mostly on the defensive since then. The yellow metal briefly dipped to $1,745 yesterday but managed to stage a local bounce to settle around $1,760 where the mentioned moving average arrives. As long as the prices stay below this SMA, the bullish potential remains limited. On the upside, a decisive break above $1,1770 would pave the way towards the $1,1785 intermediate resistance.
USDCHF has been under mild selling pressure since Wednesday. The pair briefly climber above the 0.9300 figure but failed to preserve gains and turned marginally negative on the day. On Thursday, the dollar keeps retreating and was last seen flirting with the ascending 20-DMA, today at 0.9260. If this moving average gives up anytime soon, the pair could extend the decline to this week’s lows around 0.9230. However, the downside potential looks limited at this stage. On the weekly charts, the bullish momentum is capped by a descending 100-week SMA. A decisive break above this moving average would pave the way towards the 0.9370 region where last week’s peaks arrive.