FxAnalysis

EUR/USD reversed its direction following a bearish opening to the week and closed in positive territory on Monday.

The USD/CAD pair builds on the previous day’s goodish rebound from the 1.3670 area, or a one-week low, and attracts buyers for the second straight day on Tuesday. Spot prices climb to a two-month high during the early part of the European session amid a firmer US Dollar (USD).

Gold is continuing its downward trajectory back under the $4,400 level early Tuesday, as the war in Middle East drags on even after US President Donald Trump’s effort to extend the ultimatum for Iran to reopen the Strait of Hormuz within 48 hours.

EUR/USD is showing tentative signs of recovery after finding a base near fresh yearly lows around 1.1400 just a few days ago. That said, as long as it remains below the key 200-day Simple Moving Average (SMA) near 1.1670, the pair still faces the risk of further downside in the near term.

For now, the near-term outlook for the Australian Dollar (AUD) remains constructive, underpinned by persistently high inflation in Australia and the RBA’s hawkish bias. This backdrop is likely to support further upside in AUD/USD while also offering a cushion against periodic pullbacks.

Gold has fallen over 20% since the beginning of this month, erasing all the gains seen earlier this year. The bearish pressure is unlikely to recede in the near future, as central banks have turned hawkish, which doesn’t bode well for the precious metal. Is the Gold Rush over?