The USD index rallied to late-January highs around 96.80 amid aggressive safe-haven flows
The dollar resumed the ascent versus high-yielding counterparts due to its safe-haven status as risk aversion intensified after the start of the Russian invasion of Ukraine in the early hours of Thursday. The USD index rallied to late-January highs around 96.80 amid aggressive safe-haven flows, advancing for the second session in a row. The index was last seen changing hands around 96.68, up 0.51% on the day. As such, EURUSD failed to regain the 1.1400 figure and came under renewed pressure to get back below both the 20-DMA and the 1.1300 figure. Furthermore, the pair derailed the 1.1200 figure for the first time in nearly a month and extended losses to the 1.1160 zone. Should this level turn into resistance on a daily closing basis, the pair may target long-term lows seen around 1.1120 last month.
USDRUB jumped to all-time highs around 89.00 earlier in the day before correcting below the 85.00 figure in recent trading. The Russian currency came under unprecedented selling pressure, making the country’s central bank announce FX intervention in order to stabilize the situation in the financial markets. The pair was last seen approaching the 84.00 figure and could see a deeper retreat in the near term, but the geopolitical situation suggests the Russian currency would stay pressured for the time being, especially as Western countries discuss new harsh sanctions against Russia. On the four-hour charts, USDRUB looks steadier now, with the RSI turning directionless in the overbought territory. Should the selling pressure surrounding the ruble reemerge anytime soon, the prices will easily regain the 85 figure and could retarget the mentioned tops, followed by the 90 psychological level.
USDJPY’s upside potential has been capped by the 20-DMA this week. After another rejection from this moving average, the pair plunged to early-February lows around 114.40 early on Thursday as massive risk aversion fueled demand for the safe-haven Japanese yen. During the European hours, however, the dollar trimmed intraday losses to settle around 114.65. Of note, the greenback approached the ascending 100-DMA, currently at 114.30, for the first time since September 2021. As long as the prices stay above this moving average that represents a critical support at this point, bearish risks are limited. On the upside, the immediate target is now represented by the 115.00 figure, followed by the mentioned 20-DMA, currently at 114.15. In a wider picture, USDJPY has been retreating from long-term peaks for the third week in a row, but the momentum looks too modest so far to bet on deeper losses in the coming days
The safe-haven gold jumped to September 2020 highs around $1,973 on Thursday amid massive risk aversion across the financial markets. The XAUUSD pair looks overbought now but may extend the ascent in the short term as risk-off demand will continue to persist amid geopolitical developments. Now that the bullion has settled above $1,950, the bulls are shifting their focus to the $1,990 intermediate target on the way towards the $2,000 figure that capped the advance in August 2020. On the four-hour timeframes, the technical picture looks strongly bullish as well despite the overbought conditions. Now, the immediate support is expected around $1,960, followed by the $1,916 area where may 2020 tops arrive.