The EUR/USD currency pair
- Prev Open: 1.0856
- Prev Close: 1.0898
- % chg. over the last day: +0.39 %
Today, euro traders' attention is directed to the European Central Bank's monetary policy meeting. Investors expect to get information on the central bank's policy outlook. Policymakers are expected to keep interest rates at current record levels, but traders will scrutinize updated economic forecasts and any guidance from President Christine Lagarde on the timing of potential reductions in borrowing costs. The latest data showed that Eurozone inflation slowed for the second consecutive month to 2.6% in February, slightly above expectations of 2.5%.
- Support levels: 1.0880, 1.0849, 1.0822, 1.0796, 1.0761, 1.0704, 1.0684
- Resistance levels: 1.0908, 1.0931
The trend on the EUR/USD currency pair on the hourly time frame is bullish. Yesterday, the price reached the resistance level of 1.0908. There is a response from sellers, but it’s weak. The trend is expected to continue, but considering today's ECB meeting, the price may sharply pull back to 1.0880. It is best to buy from this level or the moving average lines. Selling can be sought intraday, but only with a short-stop loss, as these will be positions against the main trend.
Alternative scenario: if the price breaks the support level of 1.0840 and consolidates below, the downtrend will likely resume.
- – Eurozone ECB Interest Rate Decision at 15:15 (GMT+2);
- – Eurozone ECB Monetary Policy Statement at 15:15 (GMT+2);
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
- – US Trade Balance (m/m) at 15:30 (GMT+2);
- – Eurozone ECB Press Conference at 15:45 (GMT+2);
- – US Fed Chair Jerome Powell Testifies at 17:00 (GMT+2);
- – Eurozone ECB President Lagarde Speaks at 17:00 (GMT+2);
- – US FOMC Member Mester Speaks (m/m) at 18:30 (GMT+2).
The GBP/USD currency pair
- Prev Open: 1.2698
- Prev Close: 1.2730
- % chg. over the last day: +0.32 %
The British pound consolidated above $1.27, reaching its strongest level since February 1, after UK Finance Minister Hunt announced a permanent tax cut to stimulate economic growth in the spring budget. Among other measures, Hunt announced a 2 percentage point cut in the National Insurance fund tax and also said that the latest OBR forecasts suggest a faster decline in inflation, which would see it fall below the 2% target within months, a year earlier than previously estimated in the Autumn Statement.
- Support levels: 1.2725, 1.2686, 1.2634, 1.2611, 1.2560, 1.2538, 1.2499
- Resistance levels: 1.2750, 1.2827
From the point of view of technical analysis, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price reached the resistance level at 1.2750, and sellers reacted moderately. Now, the price has corrected to the buying zone, but the buyers are in no hurry to take the initiative further. If the price can consolidate above the buying zone (green rectangle on the chart), it will be possible to consider buying to update yesterday's high. A price consolidation below the ascending trend line will open the way for the price to 1.2686.
Alternative scenario: if the price breaks through the support level 1.2611 and consolidates below it, the downtrend will likely resume.
- Prev Open: 150.03
- Prev Close: 149.35
- % chg. over the last day: -0.45 %
- Support levels: 148.57, 148.25, 147.67, 148.81
- Resistance levels: 148.96, 149.93, 150.22, 150.73, 150.87, 151.90
- Prev Open: 2127
- Prev Close: 2148
- % chg. over the last day: +0.98 %
- Support levels: 2131, 2110, 2080, 2057
- Resistance levels: 2160
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
- – US Trade Balance (m/m) at 15:30 (GMT+2);
- – US Fed Chair Jerome Powell Testifies at 17:00 (GMT+2);
- – US FOMC Member Mester Speaks (m/m) at 18:30 (GMT+2).
The USD/JPY currency pair
The dollar came under pressure on Wednesday after the February ADP US jobs report showed that companies hired fewer workers than expected, which is dovish for Fed policy. This helped the Japanese yen strengthen yesterday. The yen also rose on Wednesday and Thursday after a Bloomberg report said Bank of Japan officials are becoming more confident about wage growth, which supports abandoning the negative interest rate policy in March or April. Swaps put the odds of a 10 bps BoJ rate hike at 53% at the next meeting on March 19 and 83% at the next meeting on April 26.
From the technical point of view, the medium-term trend on the currency pair USD/JPY has changed to a downtrend. The yen is strengthening on expectations of a BoJ policy change this spring. At the moment, the price has reached the support level of 148.57. Most likely, there will be some selling coverage by large participants here, which will lead to the price rebound to 148.96. Since the divergence has not been formed yet, a further price decline to 148.25 is expected.
Alternative scenario: if the price breaks and consolidates above the resistance level at 150.56, the upward trend will likely resume.
The XAU/USD currency pair (gold)
Gold jumped to a new record high of $2,146 an ounce on Wednesday after Federal Reserve Chairman Jerome Powell said in prepared remarks before congressional testimony that the central bank expects to cut the benchmark interest rate later this year. Powell said a rate cut could happen this year, but only when there is confidence that inflation is moving steadily toward the 2% target.
From the point of view of technical analysis, the trend on the XAU/USD is bullish. Closing of profits is observed on gold. After a surge in volumes, the price is no longer rising but is flat, which is a sign of closing previously opened positions. The price is narrowing into a wedge. The MACD indicator indicates a technical correction. Under such market conditions, the price may make one more liquidity test above 2160, after which there may be a sharp wave of selling. Therefore, if the price breaks the mentioned rising wedge, we can consider selling with a minimum target of 2131. There are no optimal entry points for buying now as the price is overbought.
Alternative scenario: if the price breaks below the support at 2038, the downtrend is likely to resume.
by , 2024.03.07
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