The downside potential remains limited amid rising coronavirus cases in many countries
Following the initial bullish attempts, the dollar turned lower versus most rivals during the European hours on Monday as risk sentiment started to improve somehow. Still, the downside potential remains limited at this stage as rising coronavirus cases in many countries along with the outperformance of the American economy continue to underpin the safe-haven dollar demand.
Also, the US CPI data could lift the greenback this week if the figures surprise on the upside. In this scenario, US Treasury yields will likely resume the ascent, sending the currency higher following the current downside correction.
EURUSD has settled above the 1.1900 figure following recent losses. However, the common currency lacks the directional impetus to challenge last week’s highs in the 1.1930 area. Despite the recent bounce, bearish risks continue to persist even as the pair is now back above the 20- and 200-DMAs.
As for USDJPY, the pair slipped below the 20-DMA on Monday, deriving support from the 109.30 region. It looks like the pair could resume the ascent towards more than one-year highs around 111.00 following the current consolidation.
Elsewhere, gold prices struggle to regain upside momentum despite the current weakness surrounding the dollar. The yellow metal turned just slightly positive on the day in recent trading following a bounce from the 20-DMA. The bullion needs to stage a robust rise above the $1,760 area so that to see more sustained gains in the medium term. Now, downside risks continue to prevail as the greenback remains within a broader uptrend.
Meanwhile, bitcoin price continues to trend higher these days, holding just shy of all-time highs seen just one month ago in the $61,700 area. Following the initial rally above the $61,000 figure, BTCUSD has corrected lower in recent trading and was last seen just below the $60,000 psychological mark.