The Dollar has certainly displayed some resilience against a wave of political uncertainty and heightened fears of U.S protectionism this week.
Bold comments from the White House’s new national economic advisor, Larry Kudlow, stating that he would “buy King Dollar” heavily supported the currency, while better than expected economic reports fueled the upside. With mounting expectations over higher US interest rates this year also contributing to the rebound, “King Dollar” could return with style. It must be kept in mind that the Dollar still remains a battleground with fears of a global trade war supporting bears. However, US rate hike expectations and bullish sentiment towards the US economy are inspiring bulls. Taking a look at the technical picture, the Dollar Index has scope to venture higher if bulls are able to secure a weekly close above 90.00. The next key levels of interest above the 90.00 level are 90.30 and 90.50, respectively.
Yen boosted by market uncertainty
Yen bulls were instilled with fresh inspiration on Friday as the combination of political drama in Washington and fears of a global trade war boosted appetite for safe-haven assets.
The USDJPY is coming under increasing pressure on the daily charts with further losses on the cards as risk aversion empowers Yen bulls. Taking a look at the technical picture, there have been consistently lower lows and lower highs while prices have found comfort below the 50 Simple Moving Average. A weekly close below the 105.50 level could invite a decline towards 104.00. Alternatively, if bulls are able to defend the stubborn 105.50 support, prices could experience a rebound higher towards 107.00.
Aussie bears attack 0.7750 level
Aussie bears wasted no time in attacking the 0.7750 support level on Friday as the Dollar appreciated.
Focusing purely on the technical picture, the pair remains bearish on the daily charts. Prices are trading below the 50 Simple Moving Average while the MACD has crossed to the downside. A weekly close under the 0.7750 level could result in a decline towards 0.7680. If bulls want to wrestle back some control on the daily charts, prices have to close back above 0.7900.
Commodity spotlight – Gold
It has been a rollercoaster trading week for Gold as market players juggled with the conflicting market themes impacting the yellow metal.
Prices were initially supported by rising fears of U.S protectionism and political uncertainty in Washington which stimulated risk aversion. Bears wasted no time in attacking on Thursday after the White House’s new national economic advisor, Larry Kudlow, stated that he would “buy King Dollar” and “sell Gold”. With market expectations of higher U.S interest rates another key theme weighing on Gold prices, further downside could be on the cards. Taking a look at the technical picture, Gold slipped to a two-week low at $1309.50 during Friday’s trading session. Sustained weakness below $1314 could encourage a decline towards $1310 and $1300, respectively.
Silver punished by resurgent Dollar
Silver found itself under pressure on Friday thanks to an appreciating U.S Dollar, with prices currently sinking towards $16.25 as of writing.
Taking a look at the technical picture, the metal remains depressed on the daily charts. Prices are trading below the 50 Simple Moving Average while the MACD has crossed to the downside. A decisive breakdown and daily close below the $16.25 level could encourage a decline towards $16.16 and $16.00, respectively. Alternatively, if bulls are able to push Silver above $16.50, this could invite an incline higher to $16.70.