EUR/USD on course to reach channel’s bottom

 

EURUSD plummeted to a new twenty-year low of 0.9547 early on Monday after its most devastating week since the pandemic, with the focus now shifting to the bottom of the 2022 bearish channel at 0.9480.

The price managed to recoup some losses and return above the 0.9600 level over the past couple of hours, as the RSI and the stochastics hinted at oversold conditions. Although some recovery would not be surprising after an ugly sell-off, the technical indicators haven’t exited the bearish area yet, making additional losses possible in the short term.

If the bears worsen the outlook below the channel, the price may initially get congested somewhere between 0.9400 and 0.9335, taken from June 2002. Slightly lower, the 0.9270 area was a tough barrier to upside movements in September 2001, and it overlaps with the extension of the tentative descending line from October 2019. Therefore, it may attract special attention ahead of the 0.9190  handle.

On the upside, the 0.9709 level came to limit bullish pressures today, but above that, there is a more challenging territory at 0.9830 – 0.9850, which the bulls need to claim first before they revisit the 20-day SMA at 0.9940. Reaching parity will be the next target, while higher, buyers will be eagerly looking for a decisive break above the 50-day SMA and the channel at 1.0067 to stage an exciting rally towards September’s high of 1.0197.

All in all, the negative trend in EURUSD remains constant and irreversible for now, bringing the channel’s lower boundary at 0.9480 next on the radar.  

EURUSD

Gold extends its decline to fresh 29-month lows

 

Gold has been losing ground since early March, generating a profound structure of lower highs and lower lows within a descending channel. Furthermore, in the last few daily sessions, the technical picture has deteriorated, with the price forming consecutive fresh 29-month lows and trading beneath its lower Bollinger band.

The short-term oscillators currently suggest that bearish forces are strengthening. Specifically, the RSI has entered the 30-oversold zone, while the MACD histogram is retreating below both zero and its red signal line.

Should selling pressures persist, the 1,600 psychological mark could act as the first line of defence. Sliding beneath that floor, the April 2020 support of 1,566 might curb any further downside moves. Failing to halt there, the attention could shift to the March 2020 low of 1,451.

On the flipside, bullish actions could propel bullion towards its recent high of 1,688. Conquering this barricade, the bulls could aim for the crucial 1,734 level, which overlaps with the 50-day simple moving average (SMA) and the restrictive trendline taken from the commodity’s peaks. Jumping above that zone, the price could ascend towards 1,765 or higher to test the August high of 1,807.

All in all, gold has been developing within a descending move since March 8, and only a decisive advance above the upper boundary of its declining channel may change its outlook to bullish. 

Gold

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