A daily close below the $1,725 figure would suggest that gold prices could target fresh nearly one-year lows down the road
The dollar index rose to 108.55, the highest since October 2002. The buck has retreated marginally since then while still clinging to the upper end of the extended trading range in early European deals. Against this backdrop, EURUSD hit parity for the first time since 2002, threatening the 1.00 mark that could be derailed in the near term as the greenback could derive extra support from the US CPI report. Technically, the oversold euro desperately needs a correction, especially as the pair has dipped to parity. Of note, following the early plunge, the shared currency trimmed intraday losses to settle around 1.0040 ahead of the European open but failed to extend the bounce, suggesting traders are not ready to buy the cheap euro just yet. As such, EURUSD may fail to derive support from the 1.00 mark which could be derailed in the near term. In this scenario, traders would target the 0.95 mark next.
GBPUSD failed to hold above 1.1850 as the pressure from USD bulls intensified to push the pair towards fresh March 2020 lows just above the 1.1800 mark that now represents the immediate support for the cable. The prices bounced slightly since then, still staying deeply in negative territory both on the daily and weekly charts. GBPUSD now needs to regain the 1.1865 zone in order to trim losses in the near term. However, as the daily RSI hasn’t entered oversold territory just yet, the pound is likely to see even deeper losses at this stage before staging a reversal eventually. On the four-hour timeframes, GBPUSD has broken back below the descending 20-SMA while the RSI continues to target south, which implies that the UK currency has room for further losses in the immediate term.
On Monday, USDJPY exceeded the 137.00 mark for the first time in 24 years to notch fresh tops around 137.75 before retreating marginally amid profit-taking. As the pair keeps advancing north, the 140.00 mark comes into the market focus. The greenback remains on the offensive, holding just above the 137.00 mark during the European hours on Tuesday. The pair turned slightly negative on the day but still clings to the upper end of the extended trading range. For now, the path of least resistance remains to the upside, especially as the daily RSI remains in neutral territory. Should the dollar come under pressure in the near term, the nearest support is expected at 136.60, followed by the 20-DMA, today at 135.60. On the hourly charts, the pair fell slightly below the 20-SMA. In a wider picture, the overall bullish trend remains intact while above at least the 120.00 mark last seen in March.
The non-yielding precious metal keeps bleeding these days, refreshing multi-month lows. The XAUUSD pair fell to $1,723 earlier on Tuesday for the first time since late-September before bouncing back into positive territory in recent trading. However, unless there is a sustained break above the $1,750 zone, the bullish interest is not expected to return in earnest. The downside momentum intensified after failure to hold above the $1,800 level last week, thus opening the way towards the $1,700 next psychological support last seen nearly one year ago. As of writing, the metal was changing hands around $1,736, up 0.18% on the day. On the four-hour charts, the prices remain capped by the descending 20-SMA, adding to a bearish technical outlook in the near term. A daily close below the $1,725 figure would suggest that the pair could target fresh nearly one-year lows down the road.