Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

U.S. Dollar Slips To A 4-Month Low

Daily Forex Market Preview, 28/03/2017

Amid lack of any clear catalysts, traders focused on "Trumponomics" with the failure to repeal Obamacare being on the radar. The U.S. dollar extended its declines yesterday after gapping lower on the open. Investors scaled back their bullish bets as the markets are now doubtful if President Trump will manage to pull through with his tax and infrastructure reforms.

On the economic front, it was a quiet day in the markets yesterday with only the German Ifo business climate posting a modest increase of 112.3, coming out better than the forecasts.

Looking ahead, the U.S. conference board's consumer confidence data and the Richmond manufacturing index numbers are on the tap today. The Bank of Canada Governor, Poloz is expected to speak today ahead of the Canadian GDP data coming up later in the week.

EURUSD intra-day analysis

EURUSD (1.0866): EURUSD gapped higher at the open yesterday and managed to maintain the gains through the day although the single currency touched a 4-month high at 1.0900 during the trading session. The median line plotted on the 4-hour chart shows prices attempting to break out from the median line, and the subsequent failure to hold on to the gains indicates a near term pullback.

Technical support is seen at 1.0700 which could be tested ahead of a minor support at 1.0800 which could offer some short term bounce in prices. However, as far as the bias is concerned, EURUSD could be seen pushing lower unless price convincingly breaks above 1.0900.

USDJPY intra-day analysis

USDJPY (110.54): USDJPY fell to a 4-month low yesterday towards 110.122, but price managed to post a reversal just above the 110.00 handle. The near-term consolidation could see USDJPY hovering near the current levels, but the downside momentum could be waning. Watch for a potential break out above 110.75 which could signal a continuation to the upside.

Technical resistance is seen at 112.00 where USDJPY could be seen targeting but could remain range bound thereafter. Only a breakout above 112.00 will signal further upside towards the next main resistance level at 113.80.

XAUUSD daily analysis

XAUUSD (1254.63): Gold prices pulled back from the sessions of 1261.01 yesterday as prices continue to hover near 1250.00 handle for the past four trading sessions. With the daily Stochastics firmly in the overbought levels, gold prices are at risk of a correction.

With technical support at 1200.00, we can expect gold prices to slip back to this level in the near term. With no major events lined up for today, gold prices can be expected to remain consolidating at the current levels, ahead of the U.S. third GDP revision coming up later in the week.