The greenback looks vulnerable after dovish comments from Powell
EURUSD
The US dollar tries to steady after Friday’s plunge witnessed amid dovish hints from Powell. The USD index dipped to fresh more than one-year lows in the 100.55 area earlier on Monday before bouncing marginally in recent trading. The greenback lacks the recovery momentum and remains vulnerable to further losses in the near term. The buck seems to have found a local bottom around the mentioned lows, struggling to attract demand on a dip, however. The DXY now tries to hold above the support zone in anticipation of fresh drivers. As the buck remains weak, EURUSD keeps climbing these days to register more than one-year highs around 1.1200 before retreating slightly. As such, the daily RSI stays in overbought territory, showing a mild bearish bias during the European trading. The euro looks overbought at the current levels, which implies that a local downside correction could take place in the near term. The single currency was last seen changing hands around 1.1179, down 0.01% on the day.
GBPUSD
The pound saw a seven-day rally to register March 2023 highs ahead of the weekend. In particular, the pair jumped to the 1.3230 region before retreating slightly on Monday. As such, GBPUSD continues its ascent, holding firmly well above the key SMAs. The cable looks set to extend gains if dollar weakness remains in place in anticipation of a Fed rate cut. Of note, the bullish potential persisting despite some overbought signals on the daily charts. On the four-hour timeframes, the RSI is stays in overbought territory, showing a bearish bias, suggesting a local correction could be expected in the near term. In a wider picture, the technical outlook has improved substantially over a couple of weeks, with GBPUSD rallying this month after four weeks of losses in a row. In recent trading, GBPUSD was changing hands around 1.3194, down 0.01% on the day. On the upside, the immediate significant resistance is now represented by the mentioned high, followed by the 1.3280 figure. While above the 200-week SMA, today at 1.2847, bearish risks are limited.
USDJPY
The USDJPY pair extends Friday’s slide at the start of the week amid broad weakness in the US dollar. Earlier in the day, the greenback briefly fell to three-week lows in the 143.44 area where buyers reemerged to push the prices to the 143.90 region. However, the pair struggles to attract more decisive demand, staying under the selling pressure. USDJPY still lacks the upside momentum, suggesting downside risks surrounding the dollar continue to persist. During the European session, USDJPY has settled slightly below 144.00, trying to trim losses while staying negative for the day. Earlier, the ascent was capped by the descending 20-DMA that continues to spook potential buyers. As such, the pair remains vulnerable to fresh losses in the near term. In the immediate term, a daily closure above 144.00 would somehow improve the technical outlook. The pair was last seen changing hands around 143.90, down 0.32% on the day. The daily RSI stays close to the oversold territory, but the pair could refrain from sustained bullish attempts in the near term. Should the pressure intensify, the dollar may get back below the 143.50 figure in the days to come.
XAUUSD
Gold prices stay bullish after refreshing all-time highs last week. The XAUUSD pair extended gains to the $2,570 figure amid persistent dollar weakness. On Monday, the bullion holds in the green, staying resilient as buyers remain in the game despite overbought conditions. As such, the bullion has settled slightly below historic highs, deciding on further direction. The overall technical picture remains bullish after the latest jump, especially as the dollar remains weak. The precious metal now holds above the key SMAs, flirting with the $2,560 figure that represents the nearest resistance at this stage. The downside potential remains limited, and the broader outlook stays bullish in anticipation of a Fed rate cut. In recent deals, the XAUUSD pair was changing hands around $2,561, up 0.57% on the day. On the weekly timeframes, the technical picture stays positive, with the RSI pointing north. On the downside, the immediate significant support is now represented by the $2,535 zone, followed by the $2,520 figure.
