GBPUSD may derail the 1.2100 mark for the first time since May 2020
The USD index rallied to fresh twenty-year highs just below the 105.00 mark on Thursday before turning negative today as traders opted to take some profit amid improvement in global risk sentiment. The index derives support from the 104.50 zone during the European hours, with the focus shifting towards the 104.00 immediate support. However, the greenback is likely to resume the ascent after a short-lived correction. EURUSD fell to 1.0354 before bouncing marginally early on Friday. However, the pair failed to regain the 1.0500 mark and came back under selling pressure as the buck remains resilient, refraining from a deeper correction despite the overbought conditions. A break below the mentioned lows would open the way towards 2017 lows in the 1.0340 zone, followed by the parity level. On the immediate term, the common currency needs to get back above the 1.0480 intermediate barrier on the way towards 1.0600. However, the path of least resistance remains to the downside.
The cable fell to two-year lows around 1.2165 amid the rallying dollar. The pair is finishing the fifth bearish week in a row, with the RSI on the weekly timeframes pointing lower but is yet to enter the oversold territory, which implies that there is still room for further decline in the near term. Should the mentioned lows give up, GBPUSD may derail the 1.2100 mark for the first time since May 2020. During the European trading hours on Friday, the pound stays below the 1.2200 zone, struggling to attract demand as the buck is back around long-term highs. On the four-hour charts, the prices stay below the descending 20-SMA while the RSI is pointing south, suggesting the cable could suffer deeper losses in the near term. On the upside, the immediate resistance now arrives in the 1.2230-1.2250 area. A decisive rebound above this zone would open the road to this week’s high of 1.2400.
USDJPY refreshed may lows on Thursday amid some recovery in the Japanese yen. The pair extended losses to 127.50 before finishing above 128.00. Today, the pair is back on the offensive, targeting the ascending 20-DMA, currently at 129.11. So far, this moving average has been capping the upside momentum at this stage, but the overall technical outlook remains constructive while above 121.00. On the hourly timeframes, the dollar derives some support from the 20-SMA while the RSI looks directionless around the 50 figure, suggesting the technical picture looks neutral for the time being. At the same time, the pair looks set to finish lower for the first time in ten weeks. It looks like the pair would resume the ascent following a short-term correction. Otherwise, the yen recovery will continue in the coming days.
Gold prices plunged to the $1,820 zone on Thursday as the dollar rallied to fresh twenty-year highs. The non-yielding metal stays pressured by the rallying greenback amid the elevated inflation in the United States that pushes the Federal Reserve to more aggressive tightening. The XAUUSD pair dipped to fresh three-month lows around $1,810 earlier on Friday before bouncing slightly. The yellow metal now holds below the 200-DMA, currently at $1,835, suggesting the recovery potential is limited for the time being as dollar demand could reemerge anytime soon. Also, some rebound in stock markets caps the safe-haven gold’s upside potential. Should the bullion fail to hold above the mentioned lows in the near term, the $1,800 handle will come into the market focus. Failure around this threshold would pave the way towards the yearly bottom around $1,780.