With just one more trading day to go, the US dollar is posed to close on a bullish note in the month of May following a strong and steady decline since January this year. Further upside is likely to continue and will keep the momentum going to the upside. Gold prices have weakened significantly with prices now trading near the $1200 an ounce psychological level, which could keep prices supported to the upside in the near term but overall, the bullish rally is clearly fading.
EUR/USD Daily Analysis
EUR/USD (1.110): EUR/USD has posted a steady decline for the past four weekly sessions, closing Friday at 1.1112. On the 4-hour chart, EUR/USD is likely to post a retracement with the current lows in price not confirmed by the Stochastics oscillator. Price action needs to close above 1.1143, in order to validate a retracement which could see a correction to 1.138, which is pending for a retest of resistance confirmation. To the downside, continued momentum could see EUR/USD fall further towards 1.110 support.
USD/JPY Daily Analysis
USD/JPY (110.9): USD/JPY was bullish on Friday closing at 110.34, but price action closed a few pips above the 50 period EMA. The ranging price action is likely to continue with a risk of a brief test to 111.0 resistance. The 4-hour chart shows USD/JPY caught within the range of 110.31 - 110.672 resistance and 109.35 support. Further upside is likely only on a break above 111.31 resistance high, while to the downside, 108 support will be tested if the current support at 109.35 breaks.
GBP/USD Daily Analysis
GBP/USD (1.462): GBP/USD closed bearish on Friday following a brief test to 1.4743. Support at 1.4425 remains a likely level for GBP/USD to test but the downside is limited from the current levels. The 4-hour chart shows price trading below 1.4668 - 1.4647. Any rallies are likely to be capped near this resistance, which could see an eventual decline towards lower support at 1.4461 - 1.44450.
Gold Daily Analysis
XAU/USD (1203): Gold prices cleared the 1230 support on Friday and closed the 4-hour session in a hammer pattern. Prices slipped down to 1203 in early trading today with the psychological barrier seen at 1200, likely to hold the declines. Resistance at 1230 - 1225 will be the initial level that could cap the rallies, but a break above this level could see a move back to 1250 and eventually to 1262 - 1258 main support level that was broken and which could now be tested for resistance.