Should the metal retain bullish bias, the $1,900 psychological level will come back into the market focus
The US dollar remains on the defensive on Thursday, extending its pullback from the recent November highs seen around 107.35 last week. Earlier in the week, the USD index derailed the 106.00 figure that turned into resistance. Today, the DXY is threatening the 105.50 support zone as selling interest persists as the FOMC meeting minutes failed to spark a bounce in the greenback. As such, the buck keeps distancing itself from cyclical tops and could threaten the 105.00 figure if the pressure keeps building in the near term. The greenback is now on the defensive amid more dovish hints from the Fed speakers along with lower yields. A wider technical picture, however, stays positive so far. Should the DXY see further bearish pressure, a decisive break below the 105.50 figure would open the way towards fresh local lows. Meanwhile, EURUSD keeps recovering for the seventh session in a row. The pair is changing hands around 1.0620 as of writing, up less than 0.1% on the day after a brief jump to 1.0639 earlier in the session.
The pound found support around fresh March lows around 1.2035 last week and has been recovering since then. The pair has settled above 1.2250 in early European deals on Thursday to turn slightly negative in recent trading after another failed attempt to break above 1.2300. The cable hesitates now after six days of gains, seeing a bounce due to a weaker dollar. Now, the pound holds well above the lower end of the extended trading range, also trading above the descending 20-DMA. During the European deals, the pair looks slightly bearish, trying to attract renewed demand at this stage. The daily RSI points slightly lower in neutral territory, suggesting the pair could see some pressure in the immediate term before bouncing. In recent trading, GBPUSD was changing hands around 1.2298, down 0.11% on the day. On the downside, the immediate significant support is now represented by the 1.2260 zone. On the upside, a decisive recovery above 1.2300 would pave the way to a more sustained bounce.
The USDJPY pair looks relatively steady these days, oscillating above the ascending 20-DMA. The dollar holds slightly positive during the European trading hours on Thursday, trading below fresh October 2022 highs seen around 150.15 last week. The pair has settled above the 149.00 figure, staying elevated despite overbought conditions. As the pair still stays mostly above the ascending 20-DMA, downside risks remain limited in the near term. The dollar was last seen changing hands around 149.17, up 0.02% on the day. Now, the greenback needs to confirm a break above the 149.00 region in order to extend the ascent. The daily RSI stays directionless, holding in neutral territory, suggesting the dollar could see some consolidation in the immediate term before deciding on further direction. On the hourly timeframes, the technical picture looks upbeat, with prices back above the key SMAs while the RSI turned positive in neutral territory.
The price of gold bounced aggressively at the start of the week to open with a solid bullish gap and has been trending higher since then. Last week, the metal briefly dipped to fresh March lows around $1,810 before finishing in positive territory due to a decline in the US dollar. Now, the technical picture improves as the bullion is flirting with the descending 20-DMA. The XAUUSD pair extended gains to the $1,882 zone and was last seen changing hands around the upper end of the extended trading range. Should the price break above this region, the $1,900 psychological level will come back into the market focus. If the pressure reemerges any time soon, the bullion could get back below the $1,865 zone. Gold was last seen changing hands around $1,879, up 0.25% on the day. On the weekly timeframes, the bullion remains vulnerable even as the metal bounced from the key SMAs. On the upside, the immediate target is now represented by the $1,890 region, followed by the $1,900 zone. On the four-hour charts, the XAUUSD pair is now above the 20- and 100-SMAs while the RSI has entered overbought territory, suggesting the pair could see a local pullback in the immediate term.