The USD tries to limit losses in a retreat amid profit-taking
EURUSD
Earlier in the week, the US dollar extended gains to fresh October highs before retreating amid profit-taking. After peaking around 106.50, the USD index has settled marginally below 106.00, refraining from a deeper correction despite overbought conditions. The greenback had been rallying aggressively earlier amid safe-haven flows and ebbing Fed rate cut expectations due to stubbornly high inflation. The dollar climbed to fresh more than five-month tops in the 106.52 area, preserving most of the gains so far. In recent trading, the dollar was changing hands around 105.84, shedding 0.11% on the day. A daily close above the 106.00 zone would bring some short-term bullishness back into the game. Meanwhile, EURUSD bounced from late-October lows seen around 1.0600 earlier in the week, trading in positive territory for the second session in a row. In European trading on Thursday, the single currency has settled around 1.0678, adding 0.06% on the day. On the weekly charts, the technical picture still remains bearish after the recent slide. Now, the 1.0700 zone represents the immediate significant upside target for the shared currency. In a wider picture, EURUSD looks bearish so far this year.
GBPUSD
The pound bounced on Wednesday after three days of substantial losses, extending its recovery today. Following a brief dip to 1.2405 for the first time since mid-November, the pair managed to bounce partially, now trading back above the 1.2450 zone that has turned into support in recent trading. Should the cable manage to finish slightly above this region on a daily closing basis, the short-term outlook will improve marginally. In recent trading, GBPUSD has settled in positive territory, trying to attract more decisive demand. In a wider picture, the technical outlook remains bearish as long as the pair holds below the 1.2600 figure. The daily RSI is now bullish in neutral territory, suggesting potential sellers could stay on the sidelines in the immediate term. In recent trading, GBPUSD was changing hands around 1.2473, up 0.21% on the day. On the flip side, the immediate significant support is now represented by the 1.2450 region, followed by the 1.2425 mark that capped losses last week.
USDJPY
USDJPY keeps clinging to the upper end of the trading range since mid-March when the dollar bounced from local lows. Earlier in the week, the pair rallied to fresh multi-year highs around 154.80, holding steady today after yesterday’s short-lived retreat. Earlier last month, the pair dipped to the 146.50 zone before attracting strong demand that has been persisting so far. In recent trading, the pair has settled marginally below the mentioned highs, still preserving most of the recent gains. On the upside, the dollar is now facing the 155.00 key barrier. The pair was last seen changing hands around 154.35, down 0.02% on the day. Now, the greenback needs to hold above the 154.00 region in order to resume the ascent. The daily RSI is now neutral, suggesting the pair could refrain from a bearish attempt in the near term. Should the pressure reemerge, the dollar may derail the 154.20 area, but it looks like the path of least resistance remains to the upside so far despite overbought conditions.
XAUUSD
Gold prices rallied to fresh all-time highs around $2,448 last week before retreating marginally amid overbought conditions. The XAUUSD pair looks relatively resilient in early European trading on Thursday, with prices looking ready to extend the ascent in the near term. Still, the downside potential persists at this stage, as investors may take profit more aggressively after the spike. In recent deals, the XAUUSD pair was changing hands around $2,394, up 0.27% on the day. On the weekly timeframes, the technical picture stays positive, with wider picture remaining upbeat after reaching fresh all-time highs. On the upside, the immediate significant target is now represented by the $2,415 zone, followed by $2,450. Downside risks are limited while above the $2,300 region. Should dollar demand reemerge in the near term, the bullion may stay below the $2,400 zone that has turned back into resistance in recent trading.