EUR/USD and GBP/USD - Monitor Key Support Clusters for Next Week

Topping: After stalling around 1.3830, 61.8% retracement, the EUR/USD retreated faster in reaction to a much expected FOMC statement, which gave USD strength against most major currencies. The EUR/USD slide to 1.35 and cracked it on Friday (11/1). Taking a look at the daily chart, we see that down in the 1.3420-1.3460 area there is support/resistance pivot zone , as well as a rising speedline coming up from July's low of 1.2754.

Upside from support cluster: This week's price action shows the market has flattened if not in bearish reversal. However, in the short-term expect some support above 1.3360. With a neutral to bearish short-term (day to day) outlook that can be turning into the medium term (for a week or 2), the bullish outlook off this support should be limited to 1.3645. The stochastic reading suggests there is oversold condition. The RSI is around 40. If it dips to 30, it would reflect some bearish momentum brewing in the daily time-frame.

Gold prices fell as the dollar gained strength on taper expectations and euro weakness

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The spot price of Gold fell 2.72 percent during the past week as the dollar gained strength.  After making a slight gain on Monday, gold fell on gold stocks, ETF, gold, NYSEARCA:GLD, NYSEARCA:IAU, NYSEARCA:SLV, NYSEARCA:AGQ, NYSEARCA:PPLTTuesday and Wednesday as the FOMC monetary policy meeting took place, sparking widespread opinion that the taper could begin in December.

EUR/USD close to two-week lows during late US trade on Friday

The euro traded in proximity to two-week lows against the US dollar during late phase of US session, after the Institute for Supply Management (ISM) reported that its index of manufacturing activity climbed to the highest level since April 2011, while the euro was still pressured by prospects of a potential rate cut by the European Central Bank (ECB).

Having touched a session low at 1.3480 at 14:55 GMT, the pair’s lowest point since October 16th, EUR/USD closed at 1.3492 on Friday, falling 0.68% for the day. Support was likely to be found at October 16th low, 1.3474, while resistance was to be encountered at Friday’s high, 1.3581.