Rising euro, recovery from oversold helping gold

Alexander Kuptsikevich FxPro

Gold has added for the fifth consecutive trading session - the longest streak since early April. Intraday yesterday gold reached $1865, having retreated to $1860 now.
Although Gold’s prolonged rise in early April turned into a sell-off of almost three times the amplitude and duration, there are signs that we see the beginnings of a more sustainable move this time around.

In early May, the daily gold charts developed an oversold RSI. The recovery from oversold conditions supports the local demand for Gold.
A return above the 200-day moving average by Gold is also playing on the bulls’ side locally. A dip below could well be seen as a false breakout. A recovery above the significant trendline, the 200-day average, acts as additional psychological support.

A third important reason to buy Gold is the strengthening of the Euro. Since early April, a strong positive correlation between Gold and the EURUSD exchange rate has been well established. This correlation was broken earlier in the year by the events in Ukraine and before that by the substantial divergence in the monetary policy of the Fed and the ECB.
Nevertheless, it is easy to see that the Euro and Gold are moving together over the longer term in quiet times. Perhaps we are now seeing the beginning of a medium-term correction of the Euro thanks to increasingly hawkish signals from the ECB.

The nearest important test of the bulls’ intentions could be the $1875 area - the November highs. If it succeeds, investors and traders should keep an eye on the dynamic at $1910, where the bulls’ attack stopped at the beginning of May this year and at the end of May 2021.

Author

Alexander Kuptsikevich

FxPro

Alexander Kuptsikevich, a senior market analyst at FxPro, has been with the company since its foundation. From time to time, he gives commentaries on radio and television. He publishes in major economic and socio-political media.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.