The U.S. Dollar is looking stronger against pretty much everything except perhaps the Japanese Yen. The Euro is slowly rolling over towards last month’s low, while GBPUSD is on the verge of testing an important inflection point that may induce a bounce. Gold price is testing the August trend-line, a failure to hold could quickly lead to lower levels.
- EURUSD looking towards April lows
- GBPUSD nearing big inflection point
- USDJPY posting potential bear-flag
- Gold price hanging on August t-line
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EURUSD looking towards April lows
The Euro continues to weaken as most currencies are against the Dollar, with the April low around the 11110 mark as the next level of meaningful support. Just below there lies a series of underside trend-lines to be mindful of if weakness should carry the Euro down there. For months the pattern has been for a drop to a new swing-low, then an immediate bounce. I’ll continue to expect this to be the case until we see definitive signs of a change in behavior.
EURUSD Daily Chart (April lows, underside t-lines near)
Find out where our analysts see the Euro heading in the coming weeks based on both fundamental and technical factors – Q2 EUR Forecast
GBPUSD nearing big inflection point
Cable has a big spot to watch in the 12660s, where the August 15 low and January 15 spike-low arrive within only a few pips of one another. The fact the August low held meaning and that we had a 200-point reversal-day at the same level, make it a worthy spot to watch for a reaction. Furthering this notion is the fact that GBPUSD has been beaten down quite a bit lately and large swings for some time now have seen strong countertrend moves at the least.
GBPUSD Daily Chart (12860s big inflection point)
USDJPY posting potential bear-flag
USDJPY is countering its recent downdraft, but in doing so it is working on a possible bear-flag on the 4-hr chart. Price needs to drop below the lower parallel to validate it, first. For even more confirmation, a closing candle below the most recent swing-low at 10980 is preferred before looking for another swing lower.
USDJPY 4-hr Chart (potential bear-flag)
Gold price hanging on August t-line
Gold price is in a precarious spot with it back at the August trend-line. It’s to be trusted as support until broken, but trust is wearing thin. A break below will have the double-bottoms at 1266 in focus, followed by the 200-day at 1257. The thinking is this, whether we first see a bounce or not gold will likely trade lower at some point soon.
Gold Price Chart (Testing August trend-line)
Find out where our analysts see gold heading in the coming weeks based on both fundamental and technical factors – Q2 Gold Forecast
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX