The Euro fell as the week started, after hitting a two-week high last week, as the US Dollar recovered against the major currencies, despite the conflicting Inflation Data from the US Economy.
Despite recent declines in the pair, prices still have to break and hold below 1.1800 support levels to confirm the continuation of the decline. Breaking the resistance levels close at 1.1830 could affect the recent bearish trend and cause the market to move sideways.
The royal currency retreated during the Asian Session on Monday, after weekly gains. This decline comes in light of the recovery of the US Dollar against a basket of major currencies. Technical readings indicate that a situation of uncertainty clearly affects the market’s trading with no strong signs of a possible price break in any direction.
A break above the top of the close price at 1.3335 or a break of the near-term price at 1.3260 would give more clarity to the expected movement which would be the same direction of the break.
The US Dollar tried to rise slightly against the Yen on Monday, after falling for four sessions in a row as the Asian Stock Index rose 0.73 percent to 21,305.55 points.
Hong Kong’s Hang Seng traded 0.90 points at 28,732.00. South Korea’s Kospi Index was 0.22 percent higher at 2,479.49. Despite recent declines, the USDJPY pair still has to break above 111.85 and 111.65 to confirm the continuation of the decline. Breaking the resistance levels at 111.95 will affect the recent bearish trend and cause the market to proceed on a sideways movement.
Gold jumped sharply last week to nearly $30, hitting its highest level in two weeks due to weak US Dollar and increased demand in India due to the festival season. With the start of trading this week, Gold prices have seen some declines following the recovery of the US Dollar, causing a negative pressure on Gold, pushing it down for correction.
However, current political tensions continue to support Gold as demand for safe haven rises in general. Technically speaking, prices are trying to catch a breath after the recent strong rally. The general trend for Gold prices however remain bullish. The breach of support levels at 1296 would allow prices to decline further and may test 1290 levels.
At the same time, a breach of near resistance levels at 1303 would invite buyers to enter the market and possibly test the 1309 levels.