Gold Has Fallen Out Of Favour

• 24 Sep 2020

USD/JPY

The USD/JPY pair has found support as buyers have returned to take price action back towards the 106.05 support level. The narrower oscillations seem unlikely to challenge the longer-term downtrend given the fact that in recent trading, price action has failed to return towards the descending trendline. Momentum indicators have begun upward trajectories.  

EUR/USD

Eurodollar sellers have facilitated a breach of the 1.172 support level which could be significant if sustained. The next target is the 1.149 support area, which would also indicate a return to to a previous trading range. The longer-term rally may be reversed if bearish sentiment continues. Momentum indicators have downward trajectories. 

GBP/USD

The GBP/USD pair is testing the 1.274 support level after breaking the ascending trendline. So far, a break has not been sustained and doji candles indicate uncertainty. We have probably seen the end of the most recent rally, yet sellers appear to lack conviction to sustain the break. Momentum indicators have turned sharply bearish and RSI is approaching oversold conditions. 

USD/CHF

The USD/CHF pair has broken yet another resistance level at the 0.918 price line and the next target is the 0.925 resistance area. Bullish momentum does appear to have slowed with the pair failing to clear the resistance area. Momentum indicators have upward trajectories. 

USD/CAD

The USD/CAD pair has begun to climb once again after the break and as such, is heading towards the 1.343 resistance area. The sustained break indicates the end of the recent, long-term downtrend for the pair. Momentum indicators have sharp upward trajectories. 

GOLD

Gold sellers are beginning to dominate price action, with a break of the 1904.89. We may expect price action to head back towards the 1810.10 support level and if this is the case, the end of the recent rally is confirmed. Momentum indicators have turned bearish, with RSI testing the 30 support level. 

OIL

WTI has pulled back from a recent range ceiling at the 41.69 price level. As such, the commodity is likely to oscillate within this range as the US dollar continues to find support and the $40 per barrel range remains intact. Momentum indicators have flattened in bearish territory.