Archive for Economics & Fundamentals – Page 2

The US Currency Is Strengthening Against the Backdrop of Statements by Mr. Powell

Analytics by JustForex

The US dollar has been rising against the basket of major currencies after the speech by the Fed’s head, Jerome Powell. The official said that the US central bank would continue gradually increasing of the interest rate amid high economic growth and stable inflation. However, Powell also noted that trade disputes on the world market caused some concerns and it was still unknown how they would affect the US economy. The US dollar index (#DX) closed yesterday in the positive zone (+0.49%).

The British pound significantly weakened yesterday against the US currency. As yesterday’s economic reports showed, the average earning index in the UK, taking into account bonuses, counted to 2.5% in May, which met investors’ expectations. However, the number of jobless claims in June rose to 7.8K, while experts expected 2.3K. Today important economic statistics are expected from the UK, the Eurozone and the US.

The “black gold” prices are falling against the backdrop of growing crude oil stocks in the US from the American Petroleum Institute. At the moment, futures for WTI crude oil are testing the level of $66.75 per barrel. At 17:30 (GMT+3:00), a report on US crude oil inventories will be published.

Market Indicators

Yesterday the bullish sentiment prevailed in the US stock market: #SPY (+0.40%), #DIA (+0.24%), #QQQ (+0.61%).

At the moment, the yield of 10-year US government bonds is at the level of 2.85-2.86%.

The news feed on 2018.07.18:

– The consumer price index in the UK at 11:30 (GMT+3:00);
– The consumer price index in the Eurozone at 12:00 (GMT+3:00);
– Statistics on the real estate market in the US at 15:30 (GMT+3:00);
– The Fed’s “Beige Book” at 21:00 (GMT+3:00).

We also recommend paying attention to the speech by the Fed’s head, Mr. Powell.

Analytics by JustForex, 2018.07.18

 

 

Pound crumbles as UK inflation fails to rise, Gold dims

Article by ForexTime

Repeated signs of easing inflationary pressures in the United Kingdom could plant a seed of doubt among investors about whether the Bank of England will be raising interest rates in August.

UK inflation has unexpectedly held steady at 2.4% for the third consecutive month in June, thanks to cheaper clothing and computer games. With inflation failing to pick up, disappointing wage growth and Brexit uncertainty fueling the bearish sentiment, the British Pound is in trouble. Market expectations are likely to deteriorate further over the Bank of England taking action next month following today’s inflation report; this could be good news Sterling bears.

The technical picture looks incredibly bearish, especially when considering how the GBPUSD plummeted to a 10-month low below 1.3020 this morning. Sustained weakness below 1.3030 could inspire a decline towards 1.2900.

Gold losses shine to King Dollar

It is shaping up to be another brutal trading week for Gold with the metal plummeting to its lowest level this year against an appreciating Dollar.

The sharp depreciation witnessed on Tuesday continues to highlight how Gold remains extremely sensitive to its negative correlation against the Dollar. With Federal Reserve Chairman Jerome Powell reinforcing market expectations of two rate hikes this year, zero-yielding Gold remains a rewarding target for bearish investors. Gold is likely to be treated without mercy by a broadly stronger Dollar this week and this could translate to further downside.

Focusing purely on the technical picture, Gold is undeniably bearish on the daily charts. Daily bears won the battle after prices secured a solid daily close below $1236. With the yellow metal already extending losses today, the downside momentum could open a path towards $1200.

Currency spotlight – EURUSD

An appreciating Dollar has sent the EURUSD lower today with prices trading around 1.1620 as of writing.

The outlook remains bearish on the daily charts with 1.1600 acting as the first point of interest. A solid breakdown below this level could encourage a decline towards 1.1550. Alternatively, a move back above 1.1660 could trigger a move towards 1.1745.

Dollar boosted by Powell optimism

Dollar bulls were instilled with a renewed sense of confidence after Federal Reserve Chairman Jerome Powell struck an upbeat tone on the US economy during his first Congressional testimony.

Powell’s optimistic views on economic growth, the US jobs market and inflation simply reinforced the bullish sentiment towards the US economy. When queried about global trade tensions, the central bank head picked his words carefully by stating that it would be difficult to predict the consequences these could have on the economy. A key takeaway from the first day of Powell’s testimony was his comments on how it was best “to keep gradually” raising interest rates. The Dollar is likely to continue extending gains as market expectations mount over the Fed hiking interest rates two more times this year.

Bitcoin rebound – but for how long?

It is interesting how Bitcoin has sharply appreciated this week with prices punching above $7500 during Wednesday’s trading session.

What is even more remarkable is how the cryptocurrency remains supported despite the Dollar appreciating across the board. A possible driver behind Bitcoin’s rally could be markets simply shrugging off some regulatory concerns that have haunted attraction towards the cryptocurrency. Taking a look at the technical picture, Bitcoin could challenge $7780 if bulls are able to secure a daily close above $7500.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Intraday Analysis 18th July 2018

By Orbex

Daily Forex Market Preview, 18/07/2018

The U.S. dollar was seen posting strong gains on Tuesday. The rebound came amid the U.S. industrial production rising 0.6% on the month. The Fed Chair Powell started his two-day testimony to the U.S. Congress. In his testimony, the Fed Chair maintained the hawkish rhetoric that the central bank should continue tightening monetary policy.

Elsewhere, the UK’s monthly jobs data showed that the unemployment rate remained at 4.2% while the average earnings increased 2.5% matching estimates but slower than a revised 2.6% from the previous three months.

The UK’s Office for National Statistics will be releasing the inflation report today. Economists forecast that consumer prices accelerated at a pace of 2.6% annually in June. This marks a slight increase from 2.4% seen the month before.

Core inflation rate is expected to rise 2.1%, the same pace as the month before. Data from the Eurozone will see the final inflation figures. Headline consumer prices are expected to rise 2.0% while core inflation rate is tipped to rise at a pace of 1.0%.

The Fed Chair Jerome Powell is expected to continue with his second day of testimony to congress.

What is your knowledge like on economic data releases and how they affect the market? Learn more!

EURUSD intra-day analysis

EUR/USD

EURUSD (1.1654): The EURUSD currency pair was seen stalling near the resistance level of 1.1730 and turned lower on the day on Tuesday. Price action was seen giving up the gains made from Monday and the daily chart’s bearish engulfing pattern is likely to suggest some downside. On the 4-hour chart, the declines could push the EURUSD currency pair lower toward 1.1600 level where support could be formed. However, with the Stochastics on the 4-hour chart turning to the oversold level, we could expect to see a reversal in the currency pair.

USDJPY intra-day analysis

USD/JPY

USDJPY (112.93): The USDJPY currency pair was seen rebounding off the support level at 112.28 and rallied to fresh highs on Wednesday. Price action however remains doubtful near the current top with the Stochastics on the 4-hour chart posting a lower high. Another leg in the decline is expected. The sharp gains in the currency pair could see a minor correction back to 112.28. In the event that this level fails to hold the declines, we could expect to see steeper correction toward 111.13.

XAUUSD intra-day analysis

XAU/USD

XAUUSD (1228.01): Gold prices were seen falling to a fresh 12-month low on Tuesday. Price action is currently consolidating after slipping to lows of 1226.14. Further declines could push the price of the precious metal down to 1219 level which is another major support level that could be tested. To the upside, any gains are likely to be limited to the 1242 handle.

 

 

 

USD lifts on Powell comments

Article by ForexTime

The USD has bounced higher today on the back of comments from Governor Powell whose view on monetary policy remains the same with lifting rates steadily overtime and keeping inflation ticking along as well. So for the US economy this has been a positive statement to say the least from the FED, but it’s also further backed up by data as industrial production m/m lifted to 0.6% (0.5% exp), proving the economy is not showing any signs just yet of a slowdown. The global strength of the US economy and the lifting of interest rates is seeing large inflows of USD back into the US economy, and this includes from other countries looking to take advantage of the rates. If things are to continue with interest rate rises then the USD will continue to remain bullish when compared to other majors with much less favourable rates in the long run.

For certain economies like the Japanese one this means that the USD is likely to continue some of that bullish moment we have seen. The USDJPY for me has been a bullish favourite recently, but it has been a little sluggish at times when it comes to climbing the charts. Today though we saw the bulls come back into the market as the pushed it up to resistance at 112.862. With the USDJPY looking more aggressive the next target would be resistance at 113.704, but first we need to see a breakthrough of current resistance and as usual the USDJPY is playing of key levels and being very technical. If we see a bounce lower then I would expect support to be found at 112.033, but with a bullish climate I would expect things to continue to be positive for the USDJPY bulls in the long run, especially as fundamentals continue to be positive for the US economy.

One of the other major movers also has been gold markets as of late, which have been very bearish on the back of a stronger USD. Commodities in general have been suffering and the metal markets have come off much worse in recent times. With the bearish behaviour in full swing, and the economy booming it seems that gold could continue to find itself under pressure until the bears take a break.

Looking at gold from a technical perspective, it has recently broken through the 200 weekly average, which is an interesting signal as it bounced previously off that. So for traders this sends out a strong bearish signal in the short term. With gold drifting lower support levels at 1213 and 1189 are likely to be the key targets for traders in the market. However, I would be careful of a bullish bounce if traders get a little uncertain around geopolitics. If that was the case then resistance at 1240 and 1258 are likely to be the key targets for bullish traders, but they may certainly struggle in the current market environment for metals.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Angola cuts rate 150 bps as inflation continues to fall

By CentralBankNews.info
      Angola’s central bank lowered its benchmark BNA rate by 150 basis points to 16.50 percent and cut the ratio on mandatory reserves in kwanza by a further 100 points to 18 percent, citing a fall in inflation for the eight consecutive month and expectations that inflation would be lower than forecast.
      Today’s easing follows the National Bank of Angola’s (BNA) decision in May to unify the rate on its marginal lending facility with that of its basic interest, the BNA rate, and a 200 basis point cut in the ratio on mandatory reserves.
       Angola’s inflation rate fell to 19.52 percent in June from 26.25 in October last year while the monetary base, the operational variable of monetary policy since last November, contracted by 7.75 percent in June and by 4.58 percent year-on-year.
       The BNA has forecast inflation of 23 percent this year and now expects the rate to be lower.
       BNA said gross international reserves in June had declined to US$17.50 billion in June from $18.98 billion in May and $18.06 billion in December 2017, equivalent to 7.3 months of imports.
       As part of major overhaul of its policy operations following the arrival of Jose Massano as BNA governor in October last year, the central bank in January replaced its fixed exchange rate regime with a floating regime with bands and set the reference rate for the kwanza via auctions.
       Since Jan. 9 the kwanza has depreciated steadily and was trading at 253.6 to the U.S. dollar today, down 34.5 percent since the currency began to float.

     
   
       The National Bank of Angola issued the following statement:

“The Monetary Policy Committee of the National Bank of Angola (CPM) met today, July 17, 2018, and decided to reduce the BNA Rate from 18% to 16.5%. The CPM also decided to maintain the interest rate of the Liquidity Absorption Permanent Facility unchanged and to reduce the ratio of Mandatory Reserves to deposits of the private sector, Central Government and Local Governments in national currency to 17%.

These decisions were made possible by the reduction of the annual national inflation rate for the eighth consecutive month, as well as the projections for the latter to be below the forecast for the year (23%). In addition, a trend is expected for the reduction of the interest rates of credit in the economy.
The IPCN (National Consumer Price Index), which includes all provinces, registered a monthly variation of 1.26% in June, lower than in the previous month (-0.01 pp) and a year-on-year change of 19 , 52% in the last 12 months (-0.32 pp). The provinces with the highest monthly variations were: Malanje (2.63%), Bengo (2.38%) and Moxico (1.92%), with provinces of Lunda Sul (0.77%), Namibe , 86%) and Cuando Cubango (0.86%) recorded the smallest variations. With regard to the general panorama of the IPCN by classes, it was verified that the highest monthly price variation was observed in the Clothing and Footwear class (1.99%).
The Monetary Base in National Currency, the operational variable of monetary policy, contracted 7.75% in June 2018 and 4.58% in year-on-year terms compared to June 2017.  
In the interbank money market, in June 2018, there was a reduction of 9.49% in the amounts traded, totaling a flow of KZ 752.64 billion. LUIBOR, at overnight maturity , stood at 21.27%, which represents an increase compared to its level at the beginning of the year (17.77%).
The monetary aggregate M2, which brings together all the bank deposits in national currency and the notes and coins held by the public, reduced during the month of June in Kz 58.55 billion. In fact, it increased from Kz 4,499.73 billion in May to K 4,441.18 billion in June 2018, corresponding to a decrease of 1.30%. In the last 12 months, this indicator varied positively by 1.88%.
In the credit market, there was a monthly expansion of 3.55% in National Currency Credit.
In the period under review, the National Bank of Angola sold a total of 1,389.91 million euros to commercial banks, with a cumulative sale of € 5,749.99 million this year. This amount is lower than the amount sold to commercial banks in the same period last year at 9.76%. It is also worth noting the conclusion of most of the foreign exchange operations pending in the banking system at 31 December 2017, with the exception of regularization situations according to a schedule agreed with the local entities involved.
The fall in exports to a greater extent than that of imports resulted in a balance of the goods account in the amount of USD 2.19 billion in June, lower than in May (USD 2.73 billion).
Gross International Reserves (IBR) in June 2018 stood at USD 17.50 billion against USD 18.98 billion in May 2018 and USD 18.06 billion in December 2017. end of the month under analysis, the level of international reserves represented 7.29 months of coverage of imports of goods and services.
The next meeting of the Monetary Policy Committee of the National Bank of Angola will be held on September 24, 2018 .”

      www.CentralBankNews.info

The index is traded in a narrow range

By IFCMarkets

The US dollar continued weakeningInvestors are waiting for information on the further Fed rate hike. Amid this, the US dollar index is traded in a narrow range for the 8th week in a row.

 

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Market Analysis provided by IFCMarkets

Note:
This overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or а recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.

Dollar softens ahead of Powell testimony, Pound wobbles

Article by ForexTime

Global equity markets were mostly mixed while the Dollar dipped ahead of Fed Chair Jerome Powell’s first Congressional testimony later today.

Powell’s testimony could offer investors a fresh opportunity to appraise the Federal Reserve’s monetary policy approach for the second half of 2018. The central bank head is expected to reiterate that the Federal Reserve remains committed to gradual monetary policy tightening. However, investors may be more concerned with Powell’s thoughts on global trade tensions and the possible impact these could have on the Fed’s policy path. The Dollar has scope to appreciate further if Powell strikes a hawkish tone and reiterates his earlier comments on how the US economy ‘is in a good place’.

The Dollar’s fundamental outlook remains bullish amid robust US economic data and expectations of rising inflationary pressures on the economy. Market speculation that the Federal Reserve will be raising US interest rates two more times this year continues to heavily support the Dollar and this can be reflected in the bullish price action.

Focusing on the technical perspective, the Dollar Index could be experiencing a correction on the daily charts. Bulls need to gather enough inspiration and momentum to conquer the stubborn 95.00 resistance level. Sustained weakness below the 94.50 level could encourage a decline towards 93.90. However, bulls remain in firm control above the 93.20 lower high.

Pound shrugs off positive UK jobs report

Sterling has offered a fairly muted response to the UK employment data report, despite it printing in line with market expectations.

The unemployment rate has remained at a record low of 4.2% during the three months to May, while average earnings rose by 2.5%. With the number of people in work rising to a record 75.7%, expectations may heighten over the Bank of England raising interest rates in August. However, the fact that wage growth is at its weakest level since January could leave investors questioning whether the central bank will take action. When factoring in how Brexit uncertainty continues to weigh on sentiment, could markets be setting themselves up for another disappointment?

If UK interest rates are left unchanged in August, Sterling is likely to find itself exposed to downside shocks. Speaking of the Pound, the currency remains under pressure against the Dollar with prices trading around 1.3235 as of writing. A breakdown below 1.3190 could inspire a decline towards 1.3130.

Commodity spotlight – Gold

Gold seems to be on standby ahead of ahead of Jerome Powell’s testimony this afternoon.

The yellow metal could be in store for further pain if a hawkish Powell boosts the Dollar and reinforces market expectations of two more US rate hikes this year. Regarding the technical picture, Gold is bearish on the daily charts as there have been consistently lower lows and lower highs. Prices are clearly struggling to keep above the $1240 support level with bears waiting for the green light to send the commodity lower. A breakdown below the $1240 support level could trigger a decline towards $1236 and $1230, respectively.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

The US Dollar is falling

Analytics by JustForex

The American dollar is falling against a basket of the major currencies. Last week was marked by the maximum increase of the USD for the last month. The US dollar index (#DX) closed in the negative zone (-0,24%). US retail sales data for June was also released and it met the expectations of investors at the level of 0,5%.

The trading conflict between the USA and China is still in the spotlight. Weak economic reports from China has strengthen the concerns of the financial market participants that this trading war with the United States may slow the growth of Chinese economics. The US Administration, in turn, is not satisfied with the retaliatory duties on imports of American goods from China, the EU, Canada, Mexico and Turkey. Washington, D.C., considers these actions as illegal and illegitimate.

The Consumers Price Index of New Zealand was released during the Asian trading session. It fell to 0,4%, while experts expected 0,5%. Today we expect the statements of the head of the Bank of England, Mark Carney, and the chairman of the Federal Reserve, Jerome Powell.

The “black gold” prices drop sharply against the increasing oil supply on the world’s market. At the moment, futures for the WTI crude oil are testing a mark of $66,95 per barrel. At 23:30 (GMT+3:00), a report on the US crude oil inventories will be published.

Market Indicators

Yesterday, there was a variety of trends in the US stock market: #SPY (-0,09%), #DIA (+0,19%), #QQQ (-0,24%).

At the moment, the 10-year US government bonds yield is at the level of 2,85-2,86%.

The news feed on 2018.07.17:

– The Average UK salary at 11:30 (GMT+3:00).

We also recommend paying attention to the speech by the heads of the Fed and the Bank of England.

by JustForex, 2018.07.16

 

 

Global shares come under pressure as Oil tumbles

Article by ForexTime

Asian equities fell on Tuesday after Oil prices tumbled by more than 4.6% during the previous session, following reports that Saudi Arabia has offered additional crude supplies to some of its Asian customers and that the U.S. may release some of its strategic petroleum reserves to bring prices down.

Another factor that contributed to the fall in prices were the comments from Treasury Secretary Steven Mnuchin, who said some crude importers might receive waivers to continue buying Iranian Oil in an attempt to avoid roiling global markets. While such waivers would release some pressure off Iran, it would also cheer U.S. motorists by bringing their bills down during the summer season. After all, President Trump doesn’t want any more headaches ahead of November’s mid-term elections; so far, it seems his strategy is working.

While the fall in Oil prices dragged the U.S. energy sector down, the Dow Jones Industrial Average still managed to inch 0.2% higher supported by the financials, that ended the day 3% higher. Investors appear to have shrugged off the meeting between presidents Trump and Putin as well as warnings from the IMF that rising trade tensions could cost the global economy $430 billion.

Financial markets seem to be focusing on earnings, which have so far managed to demonstrate a strong performance, as has economic data, with U.S. retail sales rising 0.5% in June. This indicates that consumers remain in good health and are supporting further economic growth. Unless trade war announcements break out again, I think fundamentals will remain strong enough to support further gains in U.S. equities.

Later today, attention will be on Federal Reserve Chair Jerome Powell as he testifies before Congress. It will be interesting to hear his views on the flat yield curve and whether he shares Neel Kashkari’s opinion that the U.S. economy may fall into a recession if short-term yields rise above the long-dated ones, indicating that the Fed needs to slow down the pace of tightening policy. However, trade tensions and fiscal policy are the two critical topics where Democrats will likely attack the Fed Chair and clarify whether the Federal Reserve has the necessary tools to avoid any disruption.

In the U.K., the focus will be shifting from politics to economic data, with the latest releases of employment and wages figures due today. Unemployment is expected to remain steady at 4.2%, while wages are expected to slip by 0.1% to 2.7%. A surprise to the upside may increase the odds of an interest rate hike in August and thus provide Sterling with some support.

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Intraday Analysis 17th July 2018

By Orbex

The U.S. dollar was seen trading mixed on Monday. Economic data was supportive of the greenback. The U.S. retail sales report showed that headline retail sales increased 0.5% on the month while core retail sales rose 0.4%.

The U.S. Empire State Manufacturing index was seen rising to 22.6 on the index, up from 20.3 which was forecast but lower than 25.0 from the previous report.

In the overnight trading session, the quarterly inflation report from New Zealand showed that consumer prices advanced at a pace of 1.5% annually. On a quarterly basis, consumer prices rose 0.4% missing estimates of a 0.5% increase.

Looking ahead, the BoE Governor Mark Carney is scheduled to speak today. His speech comes ahead of the monthly labor market report. The UK’s unemployment rate is expected to remain steady at 4.2% while wage growth is forecast to rise at a steady pace of 2.5%.

The NY trading session will see the Fed Chair Powell’s testimony to Congress. Investors will be looking to see if the Fed Chair maintains his hawkish views on the economy. The U.S. industrial production and capacity utilization rate is also expected to be released.

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EURUSD intra-day analysis

forex eur/usd

EURUSD (1.1719): The euro was seen extending the gains on Monday against the U.S. dollar. Despite a strong patch of economic releases, the euro managed to rise to intraday highs of 1.1725. Price action has now cleared the support/resistance level of 1.1686. This is expected to keep the bias to the upside. Any dips are likely to stall back near the 1.1686 level. The currency pair is now likely to attempt to rally toward the next main resistance level at 1.1960 – 1.1920 level.

USDJPY intra-day analysis

forex usdjpy

USDJPY (112.35): The USDJPY currency pair was seen testing the price level near 112.28. The 4-hour Stochastics is pointing to a hidden bullish divergence. However, failure to break past the previous highs established at 112.71 could however signal a potential move to the downside. The break down below 112.28 could trigger further declines to 111.13 level.

XAUUSD intra-day analysis

forex xau/usd

XAUUSD (1241.67): Gold prices continue to consolidate below 1242.25 level of support. With the currency pair failing to make fresh lows, price action is likely poised for an upside breakout. The price level of 1247 – 1242.25 could potentially offer some short-term resistance. However, a breakout above this region could trigger further gains that could push gold prices to test the 1258.21 level in the next leg to the upside.