If the ascent continues in the coming days or weeks, USDJPY may target the 140.00 handle
The dollar is back on the offensive as risk aversion reemerged on Wednesday. The USD index regains ground after the recent slide, adding 0.16% on the day during the European trading hours. The index is holding above the 104.50 zone, targeting the 105.00 key immediate barrier that capped the rally early in the day. In a wider picture, the USD remains supported by the Fed’s divergence versus most of its G10 peers. EURUSD plunged to 1.0470 in Asia to regain the 1.0500 mark in recent trading as the selling pressure has abated somehow. The technical picture on the daily charts looks mixed for the time being, with the daily RSI pointing just slightly lower in neutral territory while the shared currency itself resists a deeper pullback so far. Now, the pair needs to hold above 1.0500 in the near term in order to avoid a more aggressive retreat. However, downside risks seem to persist at this stage.
The pound is back under pressure on Wednesday after two days of modest gains. The pair failed to regain the 1.2300 figure and turned lower, extending losses to 1.2160 earlier in the day. GBPUSD has trimmed some losses in recent trading while still staying on the defensive as the safe-haven demand for the US dollar reemerged. As of writing, the GBPUSD pair was changing hands marginally above 1.2200, still down 0.43% on the day. On the shorter-term timeframes, the pound is flirting with simple moving averages, struggling to stage a more sustained bounce from the mentioned local lows. Should the pressure intensify in the near term, the pair may challenge the 1.2100 mark. However, at this stage, the prices are unlikely to threaten long-term lows seen around 1.1930 last week.
USDJPY refreshed 24-year highs around 136.70 before retreating marginally in recent trading. Still, the pair could see another push north after a pause, with the 137.50 zone coming into the market focus. The yen continues to suffer from the Bank of Japan’s tight policy that comes in contrast with the Fed’s aggressive tightening plan. The pair was last seen marginally above the 136.00 figure, shedding 0.31% on the day. As the buck refrains from a more pronounced downside correction for the time being despite the extremely overbought conditions, another rally after a pause could be expected. Should the prices overcome the mentioned peaks, the 137.00 mark will come into the market focus. If the ascent continues in the coming days or weeks, USDJPY may target the 140.00 handle.
Gold prices keep trending south these days, struggling to overcome the key daily moving averages that have been capping gains for over a month already. At the start of the week, the precious metal was rejected from the $1,846 zone and extended losses to $1,823 on Wednesday. On the four-hour charts, there are some recovery attempts but the overall tone remains bearish, especially as the prices are back below the 20-, 100- and 200-SMAs. Should the selling pressure intensify any time soon, the bullion may threaten the $1,815 region, followed by the $1,800 key support zone. On the upside, the immediate barrier arrives at $1,833, while the key near-term hurdle is expected at $1,843 where the 20- and 200-DMAs converge. As such, the upside remains limited while below this region, followed by the $1,860 next threshold on the way towards the $1,900 psychological level.