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USDJPY continues to build its positive trajectory above the broken descending trendline, registering an almost three-month high of 105.33 on Thursday.
There is no key obstacle in sight until the 105.45 – 105.65 region; therefore, expectations are for the rally to see further extension in the near-term as the momentum indicators in the four-hour chart keep promoting the bullish appetite in the market. The RSI has resumed its positive slope, and the MACD is regaining ground below its red signal line, though the indicators have been moving against the market direction since the end of January, warning over a potential bearish divergence phenomenon—a bearish signal of a price reversal.
The 106.00 number could be the next target if the bulls close above 105.65.
Otherwise, should selling pressure resurface, the 20-period simple moving average (SMA) at 105.00 and the key restrictive zone around 104.85 may deter any decline towards the 104.60 barrier. If the bears breach the latter, the door would open for the 104.40 mark.
Gold Technical analysis:
Gold has accelerated its decline, tumbling below the 1800 level on Thursday for the first time in two months. The precious metal is on track for a third straight day of losses but although the momentum indicators remain overwhelmingly bearish, there is a hint of some easing in the selloff in the short term.
The RSI has slipped below the 30 oversold level and continues to trend lower. However, the stochastic oscillator is indicating the possibility of a bullish crossover between the %K and %D lines in the oversold territory. If the %K line manages to cross above the %D line in the next few sessions, it could signal an improvement in sentiment for gold and potentially mark the intra-day low of 1785.06 as a new support area.
An upward reversal could see the key 1800 level becoming the first point of resistance, with a break above it clearing the way for the 1830 level, which previously acted as support. However, for a sustained rebound, prices would need to rise back above the 20- and 50-period moving averages, currently at 1837 and 1845, respectively.
If, though, gold stretches further lower, the next major target for the bears is the November 2020 low of 1764.34.