The dollar index held steady around 90.40 in the Asian session on Thursday, while gold futures remained under pressure, now trading around $1,839.50 an ounce. Kshitij Consultancy Service’s latest post on Thursday offers forward-looking analysis of future trends in gold futures, silver futures, the dollar index, euro/dollar, euro/yen, dollar/yen, pound/dollar and Aussie/dollar.
Gold futures fell sharply. We expect gold futures to remain bearish in the medium term with a target of $1760-1740 / oz. Until then, gold futures declines are likely to stop at $1,820-1,800 / oz for now. On the upside, we currently do not expect gold to break above $1,880 / oz. Overall, gold futures are likely to trade in a wide range of $1,800 – $1,880 / oz in the near term.
Silver futures also fell sharply and are likely to retest $24.35 an ounce. If it holds at $24.35 an ounce, expect silver to rise again from that level, or it could eventually fall to $22.
The dollar index
USD index starts rally and is likely to test 91/91.50 first. The view on the short-term direction of the dollar index is bullish.
EUR/USD is falling again, with a high probability of a move towards 1.2050 in the short term. In the current correction, EURUSD could fall as low as 1.20.
EUR/JPY is likely to test support around 126/125.78, seen rallying from this area. Overall, EUR/JPY is likely to remain in a wide range of 125.78-127.50, with a break at either end of this range needed to clear further direction.
USD/JPY has rebounded sharply from yesterday’s 103.52, but we will keep a close eye on near-term resistance around 104.20 and higher 104.40/50 to see if it breaks higher or retraces from current levels in the near term.
AUD/USD has rebounded well and is likely to move towards 0.7850 or above in the medium term.
GBP/USD eased, resistance at 1.37 looks unbreakable. Sterling/dollar is likely to trade in the 1.35-1.37 range as long as it stays below 1.37, before moving up to 1.38 or above.