The greenback is unlikely to see a deeper retreat in the near term and could resume the ascent instead
The dollar has steadied around 112.00 after strong rejection from two-decade highs seen around 114.80 earlier in the week. The greenback is unlikely to see a deeper retreat in the near term and could resume the ascent instead should the PCE data add to investor concerns over the Fed’s aggressive policy. EURUSD bounced off the 0.9535 zone to get back above the 0.9800 zone, followed by the 20-DMA that arrived just below 0.9900. Despite the recovery, the shared currency is unlikely to regain parity any time soon. The daily RSI is directionless in neutral territory, suggesting the pair could lack recovery momentum in the near term, especially as the dollar has steadied after the recent retreat. On the upside, the immediate target now arrives at 0.9895 where the mentioned 20-DMA lies. A failure to hold around the current levels could bring the shared currency back under the 0.9750 mark.
The cable has been advancing north for the fourth day in a row on Friday. Earlier in the week, GBPUSD fell to all-time lows around 1.0350 to bounce strongly eventually. The pair exceeded the 1.1000 mark to extend gains towards 1.1200, adding 0.60% on the day. Despite the recent bounce, the pound is yet to preserve the upside bias as the dollar is likely to regain the ascent after a short-lived pause. In the near term, the cable could stay on the offensive, targeting the 20-DMA, currently at 1.1300. Should the prices fall back below 1.1000, the pair could retest the 1.0600 support zone, followed by the 1.0550 intermediate barrier for USD bulls. On the hourly timeframes, the RSI has entered overbought territory, while the price has exceeded the key SMAs, clinging to the upper end of the extended trading range.
USDJPY continues to hold steady after the recent jump in volatility, trading below 145.00 on Friday. Last week, the dollar briefly fell to 140.35 before bouncing back above the ascending 20-DMA that now continues to act as a key support zone. As such, the pair refrained from a major slump to regain the bullish bias that brought the prices back above 144.00. The pair was last seen changing hands around 144.30, shedding 0.1% on the day. USDJPY holds steady at the mentioned levels, refraining from another retreat, suggesting the pair could resume the ascent in the near term. After some hesitation, USDJPY could climb back to the mentioned tops and refresh multi-year highs beyond 146.00. On the downside, the nearest support is represented by the mentioned moving average, today at 143.50, followed by the 142.70 intermediate support zone.
Gold prices have been trending north for the fourth session in a row on Friday, extending recovery from 2.5-year lows seen at the start of the week. XAUUSD bounced off $1,614 to regain the $1,650 zone. The precious metal advanced towards the $1,675 zone that represents the last line of defense ahead of the descending 20-DMA, followed by the $1,700 psychological level last seen in mid-September. At this stage, bullish extension could bring the price of gold to the mentioned 20-DMA. Sustained strength beyond this supply zone could trigger a more decisive short-covering move and allow buyers to reclaim the $1,700 mark. Otherwise, the selling pressure would reemerge to send the yellow metal back below the $1,620 region, followed by the $1,600 mark last seen in April 2020.