The USD index has steadied above the 105.00 figure ahead of the weekend
The US dollar has steadied above the 105.00 figure on Friday after another drop to the 104.65 support zone yesterday. The buck struggled to regain the upside bias amid signs of slowing inflation in the United States. Against this backdrop, EURUSD regained the 1.0300 figure but failed to overcome the 1.0370 resistance zone earlier in the week. As such, the shared currency lacks recovery momentum despite dollar’s weakness, suggesting the pair remains vulnerable at this stage. As of writing, the pair was changing hands at 1.0300, down 0.16% on the day. Should the euro fail to stay above this level on a daily and weekly closing basis, the ascending 20-DMA, currently at 1.0215, will come back into the market focus. Should the momentum persist in the near term, the pair may retest the mentioned highs. However, in a wider picture, the bullish potential remains limited.
The cable bounced strongly from the 20-DMA earlier in the week to register local highs around 1.2280 before correcting back below the 1.2200 mark. The pair retains a modest bearish bias on Friday, shedding 0.3% on the day. On the four-hour timeframes, the technical picture looks mixed as the RSI turned slightly lower in neutral territory while the prices are still holding above the key moving averages. 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. GBPUSD was last seen changing hands around 1.2170, holding well above the mentioned 20-DMA.
After some consolidation just below the descending 20-DMA, USDJPY plunged abruptly earlier in the week amid broad-based sell-off surrounding the US dollar. The pair found a local bottom around 131.70 on Thursday before bouncing marginally. Today, the dollar retains a modest bullish bias, trading up less than 0.2% during the European trading hours. Despite the recent spike in volatility, the dollar remains stuck between the 100- and 20-DMAs. The fact that the prices managed to hold above the 100-SMA suggests the pair stays resilient despite a lackluster performance by the USD index, suggesting the yen bulls stay on the back foot amid the prolonged monetary policy easing by the Bank of Japan. In the near term, USDJPY could revisit the mentioned 100-DMA, today at 131.35 should recovery attempts fail. On the upside, a decisive break above the 20-DMA, today at 135.07, would bring long-term highs above 139.00 back into the market focus.
Gold prices have been climbing north for the fourth week in a row, targeting the $1,800 handle that capped the ascent earlier in the week. Following two days of modest losses, the XAUUSD pair turned slightly positive on Friday, but still lacks the upside momentum to overcome the mentioned barrier that represents the immediate hurdle for bulls. Gold prices are likely to stay resilient as long as the buck keeps bleeding. However, a failure to regain $1,800 in the near term would bring the precious metal back under selling pressure. On the downside, the immediate support now arrives around $1,780, followed by the $1,765 zone. In the near term, it looks like the bullion will continue to stay in consolidation mode with a modest bullish bias unless the greenback resumes the ascent across the market.