The US dollar finished the second bearish week in a row
As most markets are closed on Christmas holiday, currencies are stuck in tight ranges in thin trading conditions. The US dollar finished the second bearish week in a row, extending its retreat from local highs seen above the 104.00 figure earlier in the month. On Friday, the USD index briefly dipped to fresh late-July lows around 101.43 before bouncing marginally. The greenback finished below the 102.00 figure that represents the immediate upside target for the time being. In a wider picture, the DXY remains downbeat as well, pressured by dovish hints from the Fed along with weaker-than-expected inflation data. As such, EURUSD saw fresh August highs last Friday to touch the 1.1040 region. After some retreat amid profit-taking, the pair has settled above the 1.1000 psychological level, struggling for direction in holiday trading on Monday. The immediate resistance now arrives in the 1.1040-1.1050 zone that could cap the bullish momentum again if the selling pressure surrounding the dollar is limited.
The pound finished higher on Friday as dollar fell across the board. The pair retains bullish bias today, with downside momentum looking limited at this stage. The cable thus refrained from a deeper downside correction earlier last week as the dollar’s recovery attempt failed. Also on the positive side, the pair stays above the key SMAs. In ерши holiday trading on Monday, the cable looks slightly bullish, holding above the 1.2700 figure. In a wider picture, the cable stays upbeat now after this month’s slide to local lows around the 1.2500 figure. The daily RSI looks directionless in neutral territory, suggesting buyers could stay on the sidelines in the immediate term. In recent trading, GBPUSD was changing hands around 1.2702, up less than 0.1% on the day. On the flip side, the immediate significant support is now represented by the 1.2670 zone, followed by the 1.2645 region where the 20-DMA lies. On the upside, a decisive ascent above 1.2700 would pave the way to a more sustained ascent.
Last week, the USDJPY pair finished higher for the first time after five weeks of losses in a row. Still, the dollar failed to gold around local peaks registered just below the 145.00 figure. After finding resistance in this zone, the USDJPY pair reversed south to get back below the 142.00 figure. Since then, the greenback has regained this figure, albeit the upside pressure looks limited in thin trading on Monday. The greenback has settled around 142.40, still trying to attract more robust demand, but the lack of momentum suggests the selling pressure could reemerge in the near term. Also, the pair stays well below the 20-DMA, which implies that downside risks still persist for the time being. The dollar was last seen changing hands around 142.40, down 0.03% on the day. Now, the greenback needs to decisively regain the 142.50 region in order to trim losses. The daily RSI remains in neutral territory, pointing slightly lower. On the hourly timeframes, the technical picture turned slightly upbeat, with the RSI directionless while prices are now above the 20-SMA.
The price of gold held mostly in positive territory last week, albeit the momentum looked fairly modest. After finding support in the form of the ascending 20-DMA, the XAUUSD pair bounced marginally and has been consolidating with bullish bias since then. The metal extended gains to $2,070 on Friday before retreating marginally but finished the second bullish week in a row. As such, the technical picture has improved further, with the bullion holding slightly above the $2,050 zone. Should gold stay above this immediate support in the near term, a stronger ascent could be expected. If the pressure reemerges any time soon, the bullion could see another retreat in the days to come. On the weekly timeframes, the bullion looks positive, while a wider picture remains relatively upbeat. On the upside, the immediate significant target is now represented by the $2,070 region, where last week’s highs arrive. Once above, the focus would shift towards the $2,100 psychological level. On the flip side, the nearest support lies around $2,027 where the ascending 20-DMA arrives.