The euro looks set to finish the fifth bearish week in a row
The greenback extended the ascent to fresh multi-month highs in response to hawkish Fed minutes and strong economic data. After a rally, the dollar retreated partially on Thursday, correcting lower amid overbought conditions. As such, the EURUSD pair is back above the 1.1200 figure, but downside risks continue to persist despite the USD index retreats in tandem with the Treasury yields on Thanksgiving Day. During the European hours, the pair struggles below the 1.1225 intermediate resistance and was last seen changing hands around 1.1220, up 0.2% on the day. Considering the dollar’s persistent strength, the common currency may dip back below 1.1200 following a short-lived and modest upside correction. In a wider picture, the euro loos set to finish the fifth bearish week in a row.
The cable plunged to fresh 2021 lows around 1.3315 on Wednesday. Today, the pair struggles to stage a meaningful recovery, trading just above the flat-line after failed bullish attempts around 1.3355. This zone now represents the immediate barrier for sterling bulls, but it looks like the pound would finish the day on the defensive amid thin holiday trading. On the four-hour timeframes, the technical picture is mostly bearish, as the prices are still capped by the descending 20-SMA while the RSI hasn’t entered oversold territory just yet, staying marginally above the 30 figure. Furthermore, the prices are approaching the 100-SMA on the weekly charts. A break below this moving average, currently at 1.3290, would add to the downside pressure surrounding GBPUSD.
USDJPY extended gains to early-2017 highs around 115.50 on Wednesday amid a widespread rally in the greenback. Since then, the pair has retreated slightly but stayed above the 115.00 figure that represents the immediate support now. The dollar could resume the ascent after the current consolidation, with downside risks looking limited at this point. On the weekly timeframes, however, the RSI has entered the overbought territory, suggesting the pair may need a significant bullish driver to extend the ascent. On the downside, a retreat under 115.00 would pave the way towards the 114.30 area, followed by the 114.00 zone. The USDJPY pair was last seen changing hands around 115.35, down less than 0.1% on the day.
Gold prices came under severe selling pressure during the first half of the week. The bullion extended losses to early-November lows just below the $1,780 area on Wednesday before bouncing marginally. Today, the yellow metal is flirting with the 100- and 200-DMAs marginally below the $1,800 level that represents the immediate target for bulls. Despite the resurgent bullish bias, it looks like the XAUUSD pair would stay below this barrier in the near term despite some bearish correction in the greenback. A decisive break above the mentioned moving averages would improve the technical outlook and open the way towards the 20-DMA, today at $1,821. Meanwhile, on the weekly charts, the prices are barely holding above the ascending 100-SMA while the RSI is pointing lower, suggesting the metal will likely stay on the defensive so far.
USDCHF briefly rallied to early-April highs around 0.9375 yesterday to finish the day at 0.9336. Today, the pair is trading marginally lower, but still stays above the 0.9300 figure while finishing the third bullish week in a row. The technical picture on the daily charts remains bullish despite the upside momentum has ebbed somehow since the latest rally. On the hourly timeframes, the dollar is stuck between the 20- and 100-SMAs, pointing to a neutral tone in the near term. Should dollar demand pick up anytime soon, the prices could revisit the mentioned highs and target the 0.9400 figure eventually. On the downside, USDCHF needs to hold above 0.9300 in order to stay afloat on the daily charts. In general, upside risks continue to persist at this point.