It looks like the euro may lack upside momentum to preserve recent gains as the bullish trend surrounding the greenback remains intact
As the dollar reversed south, the euro managed to get back above the 1.1600 figure for the first time in a week on Thursday. The pair extended recovery to the 1.1625 region but failed to advance further as buyers were scared off by the 20-DMA that arrives at 1.1630. The common currency has retreated since then and was last changing hands marginally above 1.1600, up 0.15% on the day. It looks like the euro may lack upside momentum to preserve recent gains as the bullish trend surrounding the greenback remains intact despite the current correction amid profit-taking. In other words, EURUSD could get back below 1.1600 in the short term if the mentioned moving average doesn’t give up. On the hourly charts, the prices have settled above the 20-SMA, but the pair looks vulnerable anyway.
GBPUSD bounced from the 1.3570 area on Wednesday to extend the rally to 1.3735 in recent trading. During the ascent, the pair regained a slightly descending 20-DMA, today at 1.3615. Now, as the cable has settled above the 1.3700 figure and the mentioned moving average, downside risks abated. The prices could target the 1.3750 region next if the upside pressure persists in the short term. The pound was last seen changing hands around 1.3725, up nearly 0.5% on the day. The immediate support now arrives at 1.3700, followed by the 1.3675 region and the 1.3650 zone. On the four-hour charts, the RSI is flirting with the overbought territory, which implies that the bullish momentum could wane in the near term.
USDJPY slipped from fresh late-2018 highs registered at 113.80 on Wednesday to close around 113.25. Today, the dollar regained the upside bias and climbed to the 113.60 region earlier in the day. The prices have retreated since then but stayed in the green during the European hours. As USDJPY keeps trading above the 113.00 figure, the downside potential looks limited for the time being, with the bullish trend remaining intact. In a wider picture, the greenback has been rising for the sixth week in a row, pushing the RSI into the overbought territory. In the immediate term, the dollar needs to hold above the 113.20-113.00 region in order to avoid another bearish correction. Should the pair resume the ascent, the 114.00 figure will become the next target.
Gold prices have been rallying for the third day in a row on Thursday. The bullion climbed to one-month highs in the $1,800 area, flirting with the 100- and 200-DMAs during the European hours. If this level doesn’t give up in the short term, a downside correction could be expected. Of note, the daily RSI is pointing just slightly higher, suggesting the bullish momentum may be waning already. Should the yellow metal stage a reversal, the immediate support could be expected at $1,785, followed by the 20-DMA, today at $1,760. On the hourly charts, the prices are following the ascending 20-SMA, but the RSI is already correcting lower from the overbought territory, suggesting the metal is not ready for a decisive break above the $1,8000 psychological figure.
USDCHF plunged on Wednesday, staying on the defensive today. In the process, the pair dipped below the 20-DMA to derail the 0.9200 figure for the first time in a month during the European hours. If this level fails to withstand the pressure, the dollar could target the 0.9170 area where the ascending 100-DMA arrives. The daily RSI is pointing lower in the neutral territory, suggesting there is room for further losses in the near term. However, a bounce from 0.9200 could be expected later in the day if the US economic data surprises on the upside. If so, USDCHF would target the 0.9240 area first, followed by the mentioned 20-DMA, today at 0.9270. In a wider picture, the bullish trend remains intact as long as the prices stay above the 20-week SMA that lies in the 0.9170 area.