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MARKETS TODAY: Gold rally slowing down, Cable sees upswing

May 14, 2024

Key points

  • Gold faced resistance at $2,375 and subsequently retreated, highlighting a potential retest of support at $2,280.
  • EUR/USD broke past significant moving averages, suggesting a possible continuation of its upward trend.

On Monday, gold prices failed to sustain an upward movement beyond the $2,375 mark, resulting in a decline below $2,350. This movement suggests a possible test of lower support levels, primarily around $2,280, which aligns with the 50-day simple moving average and recent lows. Should this support level fail, the next target for sellers could be $2,260.

Conversely, a recovery above $2,350 could indicate renewed buying interest, potentially challenging the resistance at the dynamic trendline near $2,365. A break above this could set the stage for further advances towards $2,420 and $2,430.

Cable sees momentum on upswing this week

The EUR/USD pair showed positive momentum on Monday by moving above the 50-day and 200-day simple moving averages near 1.0785.

EURUSD currency pair chart on VT Markets displaying a subtle uptrend, with technical indicators including moving averages and MACD, for an article on current market trends with a gold rally slowing down and Cable seeing an upswing.

SEE: Cable displays a subtle uptrend on the VT Markets app.

This breakout might lead to further advances, with immediate resistance located between 1.0805 and 1.0810. A successful breach of this zone could pave the way to the 1.0865 level, which represents the 50% Fibonacci retracement of the 2023 selloff.

On the downside, if the pair falls below the recently surpassed moving averages, it could signal weakening bullish momentum. This could potentially drive prices towards the support levels at 1.0725 and further to 1.0695. Extended losses might see the pair descending to the May low at 1.0650.

Ninja pushes upwards

The USD/JPY pair continues to exhibit an upward trend, currently sustaining levels above 156.00. This trajectory could face resistance at 158.00, followed by 160.00. However, traders should remain cautious of possible continued interventions by Japanese monetary authorities.

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Should the pair experience a pullback, support might be found at 154.65. A fall below this level could extend losses towards 153.15, with further downside possibly testing support near the trendline and 50-day simple moving average at 152.50.

European stocks and U.S. equity futures showed minimal changes as markets await key economic reports from the United States, including the upcoming inflation data. Stability in these indices reflects a broader sentiment of caution among investors.

In currency and bond markets, movements were relatively subdued. The Bloomberg dollar index remained unchanged, and the 10-year Treasury yields held steady, as market participants anticipate further economic indicators such as the U.S. producer prices report and comments from Federal Reserve Chair Jerome Powell.