Two trades to watch: EUR/USD, Gold

EUR/USD eyes 1.22. Gold under pressure amid upbeat market mood.

Charts (5)

EUR/USD eyes 1.22

EUR/USD looks towards 1.22 and currently trades at a monthly high of 1.2180 heading into the European session amid broad US Dollar weakness.

German GFK consumer confidence March -12.9 vs -15.5 Feb & -14.3 expected. Eurozone business sentiment due later. 

The expectation of a vaccine driven quick economic recovery is spurring the reflation trade boosting demand for riskier assets whilst dragging on demand for the safe haven US  Dollar.

US GDP Q4, durable goods orders and jobless claims due later.

Where next for EUR/USD?

The 4 hour chart shows that EUE/USD is trading at the upper band of a holding channel pattern dating back to mid January. 

The 20 sma has just crossed above the 50 sma in a bullish signal, the RSI is supportive of further upside and the pair appears to be on the verge of a bullish break out.

A breakout above 1.2180 could see the bulls challenge 1.22 ahead of resistance at 1.2225.

On the flipside failure to break through 1.2180 could see the pair head back to support at 1.2120 the 50 sma. It would take a break down below 1.2080 to negate the near term bullish trend and for the bears to target 1.2025

Learn more about trading forex


Gold under pressure amid upbeat market mood

The underlying bullish tone to the markets is dragging on the safe haven gold.

Vaccine optimism, Biden’s $1.9 trillion stimulus package and Jerome Powell’s reassurances have boosted investor confidence. 

The recent rise in treasury yields is adding further pressure to the precious metal, although the weaker USD could offer some support to the commodity limiting losses.

Where next for Gold?

Gold trades below it a descending trendline on the 4 hour chart which dates back to the start of the year. However a pick up from lows of 1760 last week has seen the formation of a symmetrical triangle suggesting a break out could be on the cards.

Bulls will be looking for a move over 1810, the upper side of the triangle before turning attention to 1815 the weekly high. A break above here could see the bulls gain momentum and test horizontal resistance at 1845 ahead of 1855.

On the downside, support can be seen at 1790 the lower side of the triangle. Should the bears push through this level the monthly low at 1760 could come into play. A meaningful move below here could open the door to support at 1750.

Learn more about trading gold.

How to start trading gold


More from EUR

Disclaimer: StoneX Financial Ltd. (trading as "Forex.com") is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, Forex.com does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by Forex.com or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although Forex.com is not specifically prevented from dealing before providing this material, Forex.com does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.