The pound keeps slipping gradually from local highs seen just below the 1.2300 handle
The dollar turned slightly positive on Friday after yesterday’s sell-off. The USD index is oscillating around the 106.00 figure during the European hours, struggling to stage a decisive rebound as traders await the employment report. Should the figures disappoint, the greenback will resume the decline across the market as Fed rate hike expectations would abate further amid signs of a weaker job market. On the downside, the key support bow arrives around 105.70-105.60. EURUSD continues to struggle around 1.0250, trading marginally lower today. The pair was last seen changing hands around 1.0223, down 0.19% on the day. On the downside, the key immediate support is represented by the 20-DMA, currently at 1.0160. The bearish potential is limited while above this moving average.
GBPUSD finished slightly positive on Thursday after two days of losses to come back under some pressure ahead of the weekend. On Friday, the pair has settled around 1.2140, losing 0.13% on the day. As such, the pound is slipping gradually from local highs seen just below the 1.2300 handle that capped the recent recovery. Furthermore, GBPUSD is yet to break the downtrend that has been dominating since mid-2021. On the longer-term timeframes, the technical picture stays downbeat, with the prices holding below the key weekly SMAs while the RSI struggles for direction. On the four-hour charts, the prices are now capped by the descending 20-SMA while the RSI looks directionless, painting a mixed technical picture. A failure to finish the day above 1.2160 would imply a negative weekly close after two weeks of solid gains.
The pair failed to extend the rally on Thursday as yen demand reemerged. The dollar managed to hold above the ascending 100-DMA during the recent slide, but the 134.00 figure continued to act as resistance after yesterday’s rejection from the 134.40 zone. The dollar now faces the immediate barrier around 133.50 that could prevent the pair from bullish continuation in the near term. The daily RSI looks directionless in neutral territory while the mentioned moving average acts as a strong support zone that has been intact for nearly a year. On the four-hour timeframes, the outlook remains neutral, which implies that the greenback could struggle around the current levels before deciding on the further direction. In a wider picture, the buck stays within a corrective mode, but the recent slide towards the ascending 20-week SMA hints as rising bearish risks.
Gold prices have been surging for the third consecutive week, extending its rebound from nearly one-year lows registered last month around $1,680. The bullion regained the $1,700 mark, now targeting the $1,800 zone that has been capping further gains since Thursday. Yesterday, the precious metal rallied 1.72% to turn slightly negative on Friday as traders express a cautious tone ahead of the US NFP employment report. The XAUUSD pair may challenge the $1,800 mark in the near term, but a decisive break looks unlikely at this stage. Furthermore, a bullish continuation would need a decisive break above the 200- and 100-DMAs, today at $1,840 and $1,844, respectively. On the downside, failure to regain $1,800 would shift the market focus back to the $1,755 area, followed by a slightly ascending 20-DMA, currently at $1,737.