Gold Test $1200, EUR/USD Back At Pre-NFP Levels

The markets remained a bullish mode against the US Dollar yesterday with Gold testing the highs of $1200 yesterday while the USD/JPY fell to a 14-month low. EUR/USD managed to rally back to 1.12 region, the same levels where the currency was trading before the NFP. However, pullbacks are expected in the near term while the bias remains bullish for most of the currencies against the Greenback.

EUR/USD Daily Analysis

EUR/USD (1.12): The Euro managed to post some gains against the US Dollar yesterday with prices closing bullish back near the main resistance level of 1.13 – 1.12 region. On the 4-hour chart, the Stochastics has failed to confirm the highs in price and instead, printed a lower high, marking a potential correction to the downside. The bearish divergence could be validated if EUR/USD can close below 1.113 – 1.1105 level of minor support that has been formed. This could potentially mark a correction down to the expected support at 1.095 – 1.093.

USD/JPY Daily Analysis

USD/JPY (114.7): USD/JPY closed bearish yesterday after failing to rally off the spinning bottom candlestick pattern. With prices trading below 117.05 – 116.21 support, any upside gains are likely to be capped near this potential resistance level. However, the hidden bearish divergence on the daily chart is still at play and a correction to 120.84 region is very likely provided prices manage to close above the previous high of 115.215 and possibly establish support above this level, which could see a run back up to 117.25 – 117 region where a resistance level is likely to keep prices consolidated.

GBP/USD Daily Analysis

GBP/USD (1.44): Following Friday’s doji candlestick pattern, GBP/USD has continued to push lower with price action currently at 1.443. Support is identified near 1.43 – 1.435 region which could be tested in the near term. However, the bias in GBP/USD remains to the upside as long as this support holds, with a potential rally to 1.4635 coming in as the first level of resistance to the upside. A break below 1.43 could, however, signal a move lower down to 1.4185 and could risk price action to consolidate.