The EURUSD pair could threaten mid-2020 lows around 1.1530 in the coming days if dollar demand reemerges
The dollar remains resilient at the beginning of the week while the buying pressure has eased somehow following the release of a weaker-than-expected US jobs report last Friday. Still, the euro failed to regain the 1.1585 intermediate barrier earlier on Monday to retreat towards the 1.1550 area before trimming intraday losses in recent trading. As long as the common currency stays below the 1.1600 figure, downside risks continue to persist. The EURUSD pair could threaten mid-2020 lows around 1.1530 in the coming days if dollar demand reemerges. In this scenario, the 1.1500 figure would come into the market focus. In a wider picture, the euro struggles following five weeks of losses, and it looks like the path of least resistance remains to the downside so far.
The cable climbed to fresh October highs around 1.3670 earlier in the day before paring gains. In the process, the pair dipped back below a slightly descending 20-DMA to settle in the 1.3630 area in recent trading, up 0.11% on the day. The pound needs to regain this moving average in the short term in order to preserve the upside bias and extend gains to fresh local highs. However, it looks like the bullish potential is limited at this stage, especially as the prices stay below the 1.3700 figure last seen in late-September. On the downside, the immediate support arrives around 1.3600, followed by the 1.3575 area and 1.3540. On the hourly charts, the cable derives support from the 100-SMA. A break below this moving average (today at 1.3609) could bring back the downside pressure.
USDJPY rallied to fresh three-year highs around 113.00 on Monday as market players continue to bet on tapering of the Fed’s bond-buying in November despite soft U.S. payrolls data. Despite the emerging overbought conditions, the pair could extend the ascent in the coming days, as the dollar may receive another boost to notch fresh gains during the week. In recent trading, the prices have retreated marginally from the mentioned highs to settle around 112.90, up 0.63% on the day. Should the dollar proceed to a correction, the initial support should be expected in the 112.50 area, followed by the 112.20 region and the 112.00 handle. In a wider picture, the technical outlook looks bullish, but the weekly RSI is nearing the overbought territory, suggesting the bullish momentum could wane in the coming days.
USDCAD keeps edging lower on Monday, losing ground for the third day in a row. The pair slipped below the 100-DMA to extend losses to the 1.2445 area last seen in late-July. Now, as the prices have settled below the key moving averages, it looks like USDCAD looks set to derail the 1.2400 figure. However, should this level cap the downside pressure, a bounce higher could be expected in the coming days. as of writing, the pair was changing hands around 1.2445, down 0.08% on the day. The daily RSI is pointing lower in the neutral territory, suggesting there is room for further losses in the near term. On the four-hour timeframes, the RSI is recovering while staying on the oversold territory, which implies that the downside pressure could ease further in the immediate term.
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