Dollar bulls were missing in action this morning as the improving mood across financial markets sent investors towards riskier assets.
The Dollar Index retreated from a three-week high with prices trading around 97.10 as of writing. Although the Index remains bullish on the daily charts, bears can still make a return if prices dip back below the 97.00 psychological support level. A solid daily close below this point is likely to open a path towards 96.80 and 96.46. For bulls to maintain control and push prices higher, the Dollar Index needs to break above 97.35.
GBPUSD hovers above 1.3000
It was a quiet start for the GBPUSD as prices hovered above the 1.3000 level this morning. With Brexit uncertainty a major theme influencing the British Pound, the currency remains volatile and extremely sensitive. In regards to the technical picture, prices are trading within a wide range on the daily charts with support at 1.3000 and resistance at 1.3300. A technical rebound higher will most likely be on the cards if 1.3000 proves to be reliable support. However, a breakdown below this level is seen opening the gates back towards 1.2890.
EURUSD edges higher…..but for how long?
The Euro’s slight appreciation has nothing to do with an improved sentiment towards Europe but Dollar weakness. Concerns over the health of the Eurozone economy will remain a major drag on the Euro. The currency pair is bearish on the daily charts with sellers currently eyeing the 1.1200 support. A decisive daily close below this level may inspire bears with enough inspiration to challenge 1.1100. Alternatively, if the Euro continues to push higher on Dollar weakness, the next major resistance will be found at 1.1280.
Lira weakens after local elections
Buying sentiment towards the Lira took a hit on Monday morning after local election results showed that Erdogan's party has lost influence in major cities. With concerns over the health of the Turkish economy also weighing on the local currency, the Lira weakened roughly 2.5% against the Dollar. In regards to the technical picture, Lira weakness has the potential to push the USDTRY higher. A solid daily close above 5.70 could open a clean path towards 5.820.
USDJPY pushes above 111 handle
An appreciating Dollar has pushed the USDJPY above 111.00 level during trading on Monday. The combination of Dollar strength and Yen weakness has the potential to send prices towards 111.60 in the near term. With the currency pair trading within a bullish channel and the MACD in the process of crossing to the upside, bulls have enough ammunition to keep the USDJPY buoyed in the near term. An intraday breakdown back below 110.80 threatens this bullish setup.
GBPAUD breaks below 1.8400
Sterling bears wasted no time in conquering the 1.8400 support level last week. With the GBPAUD securing a daily and weekly close below this level, further downside is in the cards. The next key levels of interest on the GBPAUD will be 1.8310 and 1.8200.
Gold bulls still in the game
The past few trading days have not been kind to Gold prices. A combination of Dollar strength and improving risk sentiment encouraged investors to offload safe-haven Gold for riskier assets. However, the precious metal remains supported in the longer term. For as long as fears over slowing global growth, geopolitical risks and dovish Fed remain key market themes, Gold bulls still remain in the game. A solid move back above the $1300 level will trigger a rally back towards $1324. Alternatively, if $1300 acts as strong resistance, Gold is likely to test $1280 in the near term.