The last week saw a sharp sell-off in the EUR across the board, while gold prices endured a steady sell-off towards its 50-DMA. The sell-off in the EUR has been extended further today, with the EUrR/USD pair falling to 1.0519, while Gold trading at USD 1200/Oz levels.
EUR/JPY drops, extends losses below expected level
The weakness in both the assets was anticipated last week. I would begin the review with the bearish view on the EUR/JPY pair titled “EUR/JPY: More weakness ahead†(Macro Scan) published on April 7th. The report talked about the pair 129.00 levels, anticipating a 150-pip fall. The pair did dip to 129.00 on April 9th and extended losses further to hit a one month low of 126.51 levels today. The possibility of Greece witnessing another round of election has triggered fears of Grexit, thereby leading to a sell-off in the pair.
Relative strength in GBP correctly anticipated, EUR/GBP drops to 0.7202
The EUR/GBP forecast titled “EUR/GBP: Eyes 0.7200 after BOE rate decision†(Euro Pound Forecast) published on April 9th, talked about the relative resilience in the British Pound (GBP/USD) pair as compared to the EUR (EUR/USD). The technical rationale also payed out as anticipated, as the pair suffered sharp losses once it fell below 0.7241 levels, while gains were repeatedly capped at the falling trend line resistance. The pair fell to a low of 0.7202 today.
Gold reports continue to do well
The Gold forecast titled “Inverted Head and Shoulder failed, could drop to 50-DMA†(Gold Price Analysis) published on April 8th, anticipated a drop in Gold to its 50-DMA, then stationed at USD 1195/Oz. The report clearly anticipated a drop to USD 1195, and was devoid of any data/event dependency. The metal hit a low of USD 1192.5/Oz on April 9th, post, which we have seen a steady recovery to a high of USD 1209.2/Oz today.
Ahead in the week, economic data in the US is likely to start showing an improvement. Moreover, first-quarter is usually the weakest in the US, while the same is strongest in the Eurozone. UK retail sales figures could provide interesting trade setups in GBP cross, while Chinese economic data, coupled with Greece uncertainty could heavily influence the safe havens. We keep our eyes open.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.