Capital Street FX Daily Market Analysis — EUR/USD, GBP/USD, NZD/USD, USD/CAD | March 31, 2026
Source Verification: Investing.com · TradingView · Reuters · FXStreet
Daily FX Market Analysis Report
EUR/USD · GBP/USD · NZD/USD · USD/CAD | Tuesday, 31 March 2026
Source: Investing.com · TradingView · Yahoo Finance. Prices as at approximately 13:30 GMT, 31 March 2026. Prices are indicative and subject to change.
The Federal Reserve is the single most dominant force across all four pairs in today’s session. At its March 19 meeting, the FOMC voted 11–1 to hold the federal funds rate unchanged at 3.50–3.75%, with only Governor Miran dissenting in favour of a 25bp cut. The median dot plot projection keeps just one additional quarter-point cut pencilled in for both 2026 and 2027, a materially more hawkish stance than markets had priced at the start of the year. Core PCE inflation was revised higher to 2.7% for 2026 (from 2.5%), while the median GDP forecast for 2026 was nudged up to 2.4%.
The immediate catalyst today is the February Core PCE Price Index, due at 12:30 GMT. With CPI printing at 2.4% in March and the Fed’s preferred gauge running above target, any upside surprise in core PCE will compress the already-narrow window for rate cuts in 2026. The Fed has explicitly adopted a “maximum flexibility” stance in light of dual-sided risks: stagflationary pressure from the Middle East energy shock on one side, and a modestly cooling labour market on the other. As of March 2026, the US unemployment rate stands at 4.4% and initial jobless claims fell to 205,000 in the latest week, keeping the labour market resilient enough to rule out emergency easing.
Rate differential remains the structural anchor for USD strength. The 125–175bp premium the Fed funds rate carries over the ECB deposit rate (2.0%) and Bank of Canada rate (2.25%) continues to attract capital flows into USD-denominated assets, pressing EUR/USD and NZD/USD lower on any risk-off episode. Until the Fed signals a genuine pivot, USD strength is the structural baseline.
The ECB left its deposit rate unchanged at 2.0% at its March 19 meeting, pausing after eight consecutive rate cuts from June 2024 to June 2025. The Governing Council acknowledged that eurozone inflation stood at 1.9% in February — fractionally below target — but cited the Middle East conflict as a material upside risk to near-term inflation through higher energy costs. The ECB’s statement explicitly flagged that the war “poses upside inflation risks and downside growth risks,” a stagflation framing that removes any near-term prospect of resuming cuts.
The rate differential between the ECB (2.0%) and the Fed (3.50–3.75%) sits at 150–175 basis points in the dollar’s favour. This gap has been the primary structural driver compressing EUR/USD from its 2026 high of 1.2092 to current levels near 1.1469. The pair’s descent through Fibonacci levels — from 0.786 at 1.1945 to 0.618 at 1.1830, through 0.500 at 1.1749, and below 0.382 at 1.1668 — reflects the consistency of this rate differential repricing. The next scheduled ECB meeting is 30 April, and market pricing contains no expectation of a cut.
Eurozone growth remains below potential. ECB projections for 2026 describe growth as “positive but below trend,” and the structural challenges of Germany’s fiscal consolidation, subdued Chinese demand for European exports, and elevated energy import costs constrain the growth impulse. Unless CPI undershoots meaningfully below 1.5% — or a deflationary shock materialises — the ECB’s bias is firmly on hold.
The Bank of England held its Bank Rate unchanged at 3.75% at the March 19 MPC meeting, in a split 7–2 decision with two members voting for a 25bp cut. The MPC faces an uncomfortable stagflation dilemma: UK CPI printed at 3.0% in January (above the 2% target), and the Bank’s preliminary estimate indicates that energy price inflation from the Middle East conflict could push CPI back toward 3.0–3.5% in Q2 and Q3. Services inflation remains sticky at 4.4%, and the MPC’s own agents’ survey points to 2026 pay settlements of 3.6%.
The hawkish repricing is clear — market-implied rates for 2026 now slope modestly upward, with approximately 22bp of additional tightening priced. However, this has not translated into GBP strength because broad USD demand is overwhelming the hawkish BoE signal. UK economic activity is subdued: quarterly GDP growth for Q1 2026 is estimated at just 0.1%, and monthly GDP was flat in January. The BoE is simultaneously conducting quantitative tightening, reducing its QE portfolio from its peak toward a £529bn target by March 2026.
GBP/USD at 1.3205 reflects this binary tension. The pair has declined from its 2026 high of 1.3862 in a structured Fibonacci retracement, and is now testing the 0.000 extension at 1.3160. The next BoE meeting is April 30, the same date as the next ECB and FOMC meetings — a rare triple central bank convergence that markets will begin pricing in the week ahead.
The Reserve Bank of New Zealand has concluded its most aggressive easing cycle in decades. Between August 2024 and November 2025, the RBNZ cut its Official Cash Rate by a cumulative 325 basis points across seven moves, from 5.50% down to 2.25%. At its most recent meeting, the RBNZ held the OCR unchanged, and Governor Breman has signalled openness to further adjustments but without urgency, noting that “the hurdle for further cuts is high.” The RBNZ’s own projections from the November Monetary Policy Statement implied a pause through 2026.
The NZD/USD pair at 0.5713 reflects the consequence of this easing cycle meeting a Fed that remains on hold at 3.50–3.75% — a rate differential of approximately 125–150 basis points in the dollar’s favour. Annual consumer inflation in New Zealand rose to 3.0% in the September quarter, above the RBNZ’s 1–3% target band midpoint, but spare capacity in the economy was expected to pull inflation toward 2% by mid-2026. The Middle East conflict adds an oil-cost dimension that complicates this projection.
From a market structure perspective, NZD/USD has broken below the 0.236 Fibonacci retracement at 0.5787 and is pressing toward the 0.000 anchor at 0.5697. The RSI at 28.15 is in oversold territory, but all 12 daily moving averages remain sell-aligned, suggesting momentum rather than reversal is the dominant force. Any RBNZ rate cut in the April meeting would be an immediate negative catalyst for NZD.
The Bank of Canada holds its policy rate at 2.25%, having eased significantly over the prior cycle. The BoC is currently in a holding pattern, keeping options open amid mixed signals from the Canadian economy. Canada’s unemployment rate stood at 6.5% in January 2026, down from 6.8% in December, offering modest labour market support. The BoC’s rate of 2.25% sits 125–150 basis points below the Fed funds rate, creating structural pressure on CAD — which is why USD/CAD’s recovery from the 1.3479 low reflects both BoC-Fed divergence and the energy market uncertainty discussed below.
Canada’s position as a major crude oil exporter creates a unique dynamic for USD/CAD amid the Middle East conflict. In theory, higher oil prices should be CAD-positive, supporting the petro-dollar narrative. In practice, the disruption to global supply chains and risk-off investor behaviour during geopolitical escalations tends to dominate, strengthening the USD more than it boosts commodity-linked currencies. Crude oil prices remain elevated and volatile, complicating the BoC’s inflation and growth outlook simultaneously.
USD/CAD’s technical picture is the clearest directional setup in this report. The pair has broken above the 0.618 Fibonacci retracement at 1.3878, and the RSI at 66.52 confirms bullish momentum without yet reaching overbought levels. The 0.786 level at 1.3988 is the next material target, with the full 1.000 retracement at 1.4125 representing the medium-term objective. Today’s BoC Governor statement, if any, would be the key fundamental wildcard.
| Time (GMT) | Event | Currency | Impact | FX Implication for Covered Pairs |
|---|---|---|---|---|
| 09:00 | Eurozone CPI Flash Estimate (Mar) | EUR | HIGH | A CPI print above 2.2% could momentarily support EUR/USD toward 1.1540; below 1.8% would accelerate the slide toward 1.1406. |
| 09:00 | Eurozone Unemployment Rate (Feb) | EUR | MEDIUM | A surprise deterioration in Eurozone employment would reinforce the bearish EUR/USD structure and discourage any ECB hawkish pivot. |
| 12:30 | US Core PCE Price Index (MoM) (Feb) | USD | HIGH | As the Fed’s preferred inflation gauge, an above-forecast print reinforces the hold stance and pushes EUR/USD, GBP/USD and NZD/USD lower; a miss could trigger a short-covering rally. |
| 12:30 | US Personal Income & Spending (Feb) | USD | HIGH | Strong consumer spending data would reinforce USD demand broadly, adding further pressure on EUR/USD and GBP/USD near key Fibonacci support levels. |
| 12:30 | Canada GDP (MoM) (Jan) | CAD | HIGH | A weaker-than-expected Canadian GDP print would validate USD/CAD’s bullish breakout above 0.618 Fibonacci at 1.3878 and accelerate the move toward 1.3988. |
| 14:00 | US Michigan Consumer Sentiment (Final, Mar) | USD | MEDIUM | Consumer confidence data late in the session could extend USD strength if sentiment remains firm, providing a final push on NZD/USD toward the 0.5697 swing low. |
Trade the PCE-Driven Breakdowns With Precision — Capital Street FX
Today’s US Core PCE release at 12:30 GMT creates high-probability setups across all four pairs. Here’s how Capital Street FX positions you to act on each one.
EUR/USD is trading at 1.1469 on March 31, completing a sustained Fibonacci retracement from the 2026 swing high at 1.2092 (1.000) to the 0.000 anchor at 1.1406. The pair has progressively broken each retracement level with conviction: 0.786 at 1.1945 was lost in late January, 0.618 at 1.1830 breached in February, 0.500 at 1.1749 failed in early March, and 0.382 at 1.1668 gave way mid-month. Current price is holding marginally above the 0.236 level at 1.1568, but the daily candle structure shows no meaningful rejection at this level — each bounce has been sold.
The descending trendline drawn from the January 2026 highs continues to cap rallies, most recently providing resistance near 1.1640–1.1650 at the start of this week. Both the 5-day SMA (1.1499) and 50-day SMA (1.1522) are positioned above the current price and both are sloping downward, confirming the bearish moving average stack. The Fibonacci pivot at 1.1492 sits just above the current level and acts as the nearest intraday resistance. At 36.10, RSI(14) is in sell territory, approaching but not yet at the oversold threshold that might trigger a mechanical bounce. MACD at −0.001 is bearish with the signal line above, confirming the downward momentum.
The 0.000 Fibonacci target at 1.1406 is the measured objective for the current decline. A daily close below 1.1406 would complete the full retracement and open a potential measured extension. The PCE data at 12:30 GMT today represents the immediate catalyst that could accelerate or temporarily interrupt this trajectory. Resistance is layered at 1.1492 (Fibonacci pivot), 1.1499 (5-day SMA), 1.1522 (50-day SMA), and 1.1568 (0.236 Fibonacci).
| Indicator | Value | Signal |
|---|---|---|
| Overall Daily | — | Strong Sell |
| MA Alignment | 0 Buy / 12 Sell | Strong Sell |
| RSI (14) | 36.10 | Sell |
| MACD | −0.001 | Sell |
| 5-Day SMA | 1.1499 | Sell |
| 50-Day SMA | 1.1522 | Sell |
| Fib Pivot | 1.1492 | — |
| Fib Level | Price |
|---|---|
| 1.000 (Swing High) | 1.2092 |
| 0.786 | 1.1945 |
| 0.618 | 1.1830 |
| 0.500 | 1.1749 |
| 0.382 | 1.1668 |
| 0.236 | 1.1568 |
| ▶ Current Price | 1.1469 |
| 0.000 (Target) | 1.1406 |
GBP/USD at 1.3205 is pressing against the lower extreme of its Fibonacci retracement structure. The chart anchors the swing from the 0.000 base at 1.3160 (prior support) to the 1.000 high at 1.3862, and price is now testing the 0.236 retracement at 1.3383, having broken through 0.382 at 1.3428, 0.500 at 1.3511, and 0.618 at 1.3593 in the preceding weeks. Today’s daily low of 1.3159 represents an intraday breach of the 0.000 anchor, though the pair has recovered to 1.3205 — a marginally positive close today remains possible given the +0.14% intraday gain.
The descending channel structure visible on the chart shows progressively lower highs from the 1.3862 peak, with each attempted rally being contained by the channel’s upper boundary. Both the 5-day SMA (1.3252) and 50-day SMA (1.3303) are positioned above the current price and declining, providing layered resistance on any bounce. RSI at 35.09 is near oversold but not yet at the 30 threshold, suggesting momentum may remain bearish before a technical rebound materialises. The MACD at −0.002 with a bearish signal confirms the trend.
A confirmed daily close below 1.3160 would be technically significant, completing the retracement and opening potential extension targets below 1.3000. The 0.236 level at 1.3383 is the first resistance level on any recovery, followed by the 0.382 at 1.3428. The Fibonacci pivot at 1.3238 sits just above the current price and is the critical intraday pivot — a rejection here would confirm continued downside pressure into the PCE close.
| Indicator | Value | Signal |
|---|---|---|
| Overall Daily | — | Strong Sell |
| MA Alignment | 0 Buy / 12 Sell | Strong Sell |
| RSI (14) | 35.09 | Sell |
| MACD | −0.002 | Sell |
| 5-Day SMA | 1.3252 | Sell |
| 50-Day SMA | 1.3303 | Sell |
| Fib Pivot | 1.3238 | — |
| Fib Level | Price |
|---|---|
| 1.000 (Swing High) | 1.3862 |
| 0.786 | 1.3711 |
| 0.618 | 1.3593 |
| 0.500 | 1.3511 |
| 0.382 | 1.3428 |
| 0.236 | 1.3383 |
| ▶ Current Price | 1.3205 |
| 0.000 (Target) | 1.3160 |
NZD/USD at 0.5713 is the weakest performer among the non-USD currency pairs in today’s session, declining 0.14% with all structural indicators aligned to sell. The daily chart Fibonacci structure is drawn from the 0.000 anchor at 0.5697 to the 1.000 swing high at 0.6080. Price completed the full round-trip from the top, clearing 0.786 at 0.5993, 0.618 at 0.5932, 0.500 at 0.5889, 0.382 at 0.5843, and 0.236 at 0.5787 in sequence since the January 2026 high. Current price at 0.5713 sits below all retracement levels, approaching the 0.000 base at 0.5697 — a level that represents the pre-move swing low.
The RSI at 28.15 is technically in oversold territory, sitting below the 30 level. In isolation, this would be a mean-reversion signal, but in the context of a strong trend with 12 of 12 moving averages aligned to sell, oversold RSI conditions can persist. The 5-day SMA at 0.5739 sits just above the current price and has been acting as dynamic resistance on any intraday bounce. The 50-day SMA at 0.5770 is well above and declining. The MACD at −0.001 is in sell territory with the signal confirming bearish continuation.
The 0.000 Fibonacci level at 0.5697 is the immediate downside target, representing both the chart anchor and a potential area of tactical demand. A break below 0.5697 on a daily close would open extension territory with no defined Fibonacci support below. The 52-week low printed at 0.5697, meaning a close below this level would also set a new annual low. Any PCE surprise to the upside at 12:30 GMT today accelerates this move; a miss could generate an oversold bounce toward the 5-day SMA at 0.5739.
| Indicator | Value | Signal |
|---|---|---|
| Overall Daily | — | Strong Sell |
| MA Alignment | 0 Buy / 12 Sell | Strong Sell |
| RSI (14) | 28.15 | Oversold |
| MACD | −0.001 | Sell |
| 5-Day SMA | 0.5739 | Sell |
| 50-Day SMA | 0.5770 | Sell |
| Fib Pivot | 0.5734 | — |
| Fib Level | Price |
|---|---|
| 1.000 (Swing High) | 0.6080 |
| 0.786 | 0.5993 |
| 0.618 | 0.5932 |
| 0.500 | 0.5889 |
| 0.382 | 0.5843 |
| 0.236 | 0.5787 |
| ▶ Current Price | 0.5713 |
| 0.000 (Target) | 0.5697 |
USD/CAD at 1.3935 is the standout structural long in today’s report, the only pair with a Strong Buy daily signal. The Fibonacci retracement drawn from the 1.4125 swing high (1.000) to the 1.3479 swing low (0.000) shows price has recovered from the 0.000 anchor, cleared the 0.236 level at 1.3631, the 0.382 at 1.3726, the 0.500 at 1.3802, and is now operating above the 0.618 level at 1.3878. The current level of 1.3935 places price between the 0.618 and 0.786 Fibonacci levels, a zone consistent with trend continuation rather than exhaustion.
The moving average structure confirms the bullish alignment: the 5-day SMA at 1.3779 is rising, providing dynamic support on any pullbacks, and the 50-day SMA at 1.3748 slopes upward below it. Both are below the current price, which is the opposite configuration to the three sell-aligned pairs. The RSI at 66.52 shows building bullish momentum without reaching overbought levels — there is room for the RSI to extend toward 70–75 before a technical pause is warranted. The MACD at +0.001 is in buy territory with a confirming signal.
The 0.786 Fibonacci level at 1.3988 is the next material upside target, followed by the 1.000 retrace at 1.4125. The key support on any PCE-related dip is the 0.618 level at 1.3878, which held as prior resistance and now acts as demand. Today’s Canada GDP release at 12:30 GMT creates a simultaneous CAD-specific catalyst — a weak GDP print accelerates the move toward 1.3988, while a strong GDP beat would be the primary downside risk to this setup.
| Indicator | Value | Signal |
|---|---|---|
| Overall Daily | — | Strong Buy |
| MA Alignment | 10 Buy / 2 Sell | Strong Buy |
| RSI (14) | 66.52 | Buy |
| MACD | +0.001 | Buy |
| 5-Day SMA | 1.3779 | Buy |
| 50-Day SMA | 1.3748 | Buy |
| Fib Pivot | 1.3780 | — |
| Fib Level | Price |
|---|---|
| 1.000 (Swing High) | 1.4125 |
| 0.786 | 1.3988 |
| ▶ Current Price | 1.3935 |
| 0.618 | 1.3878 |
| 0.500 | 1.3802 |
| 0.382 | 1.3726 |
| 0.236 | 1.3631 |
| 0.000 (Swing Low) | 1.3479 |
Three of four pairs — EUR/USD, GBP/USD, and NZD/USD — carry identical Strong Sell daily alignment from Investing.com, with 0 buy signals and 12 sell signals across all moving averages for each pair. This degree of alignment is technically unusual and reflects the convergence of a persistent rate differential narrative (the Fed at 3.50–3.75% against ECB at 2.0%, BoC at 2.25%, RBNZ at 2.25%) and an active risk-off episode driven by the Middle East conflict’s impact on global energy costs. USD/CAD, as the lone long, provides the inverse confirmation: the same fundamental forces that weaken EUR, GBP and NZD are directly constructive for the USD side of the pair.
The macro narrative is unified by today’s US Core PCE release. As the Fed’s preferred inflation gauge, the February print due at 12:30 GMT will either validate or challenge the “higher for longer” positioning that underpins the current USD strength. A hot core PCE reading would compress rate cut expectations further, potentially accelerating EUR/USD toward 1.1406, GBP/USD toward 1.3160, and NZD/USD toward 0.5697, while lifting USD/CAD above the 0.786 Fibonacci at 1.3988. A soft print creates a counter-trend bounce opportunity, but with 12/12 MAs aligned to sell on three pairs, any bounce is tactical rather than structural.
The upcoming triple central bank convergence on April 30 — simultaneous meetings by the FOMC, ECB, and BoE — represents the next major regime-change catalyst. Until that date, the path of least resistance aligns with current positioning: dollar-long, commodity and risk-currency short.
EUR/USD is declining toward the 0.000 Fibonacci support at 1.1406 due to a persistent interest rate differential that favours the US dollar. The Federal Reserve holds rates at 3.50–3.75% while the ECB’s deposit rate sits at 2.0%, creating a 150–175bp premium for USD-denominated assets. This differential narrows the yield appeal of euro assets and drives capital flows into USD.
Today’s US Core PCE release at 12:30 GMT adds a short-term directional catalyst. Any upside surprise in core PCE would reinforce the Fed’s “hold” stance, further reducing the probability of rate cuts in 2026. Technically, all 12 daily moving averages are aligned to sell, the RSI at 36.10 is in sell territory, and the pair is below both the 5-day SMA (1.1499) and 50-day SMA (1.1522). The 0.236 Fibonacci level at 1.1568 is the nearest meaningful resistance.
The Fibonacci retracement on the daily GBP/USD chart is drawn from the 0.000 base at 1.3160 to the 1.000 swing high at 1.3862. The key levels from the chart are: 0.236 at 1.3383, 0.382 at 1.3428, 0.500 at 1.3511, 0.618 at 1.3593, and 0.786 at 1.3711. Price at 1.3205 has retraced through all of these levels and is now pressing against the 0.000 base at 1.3160.
Today’s daily low of 1.3159 represents an intraday breach of this base level, although the pair has recovered to 1.3205. A confirmed daily close below 1.3160 would be a technically significant event, suggesting the entire retracement swing is complete and opening the potential for extension below the prior anchor. The Fibonacci pivot at 1.3238 is the immediate intraday reference, with the 5-day SMA at 1.3252 above it. RSI at 35.09 is approaching but not at the oversold threshold of 30.
NZD/USD’s RSI(14) at 28.15 is technically in oversold territory, below the conventional 30 threshold that often signals elevated mean-reversion probability. However, oversold conditions in strongly trending markets can persist for extended periods without producing a meaningful reversal.
The evidence against a mechanical bounce is significant: all 12 daily moving averages are sell-aligned, price has broken below every Fibonacci retracement level including 0.236 at 0.5787, and the 5-day SMA at 0.5739 is acting as dynamic resistance on intraday rebounds. The RBNZ’s OCR at 2.25% — well below the Fed at 3.50–3.75% — removes any yield support for the New Zealand dollar. A soft US Core PCE print today could trigger a tactical bounce toward 0.5739–0.5787, but this would be a counter-trend move rather than a structural reversal. The 0.5697 swing low remains the primary target.
USD/CAD is being driven higher by a combination of structural and tactical factors. The structural driver is the rate differential: the Bank of Canada at 2.25% sits 125–150 basis points below the Fed funds rate, making USD-denominated assets more attractive than CAD assets on a yield basis. This differential has widened as the BoC has eased more aggressively than the Fed.
The tactical driver is a combination of Middle East geopolitical uncertainty (which creates risk-off flows into USD) and today’s Canada GDP release at 12:30 GMT. Canadian unemployment at 6.5% and modest growth expectations create downside risk for CAD. Technically, USD/CAD’s RSI at 66.52 confirms building bullish momentum, the 10/2 buy/sell MA alignment is strongly constructive, and the pair has successfully converted the 0.618 Fibonacci level at 1.3878 from resistance to support. The 0.786 Fibonacci at 1.3988 is the next defined target, followed by the 1.000 retrace at 1.4125.
The US Core PCE Price Index (February) due at 12:30 GMT is the Federal Reserve’s preferred inflation gauge and the most important data release for currency markets this week. At its March 19 FOMC meeting, the Fed revised its 2026 core PCE forecast higher to 2.7%, reflecting persistent inflation concern. A February print above expectations (market consensus around 0.3% MoM) would signal continued inflationary pressure, further reducing the probability of rate cuts in 2026 and strengthening the USD.
For EUR/USD, an above-consensus PCE would press the pair toward the 0.000 Fibonacci base at 1.1406 with potential for a break lower. For GBP/USD, it would accelerate the test of the 1.3160 base on a daily close basis. A below-consensus PCE miss would generate short-covering in EUR/USD toward 1.1540–1.1568 and GBP/USD toward 1.3240–1.3260, but with all 12 moving averages sell-aligned, these bounces are likely to be sold into. The PCE release also coincides with Canada GDP data, making 12:30 GMT today a high-volatility window across all four pairs.
The Bank of England held its Bank Rate at 3.75% at the March 19 MPC meeting in a 7–2 split decision, with two members voting for a 25bp cut. The BoE faces a stagflation dilemma: UK CPI printed at 3.0% in January (above the 2% target), and the MPC’s preliminary assessment indicates that Middle East-driven energy price inflation could push CPI back toward 3.0–3.5% in Q2 and Q3 2026. Services inflation remains at 4.4%, and pay settlements are tracking at 3.6%.
Markets have repriced upward — approximately 22bp of additional tightening is now priced for 2026. However, this modest hawkish repricing has been insufficient to arrest GBP/USD’s decline because broad USD demand from the Fed-hold narrative is more powerful. UK economic activity is subdued at approximately 0.1% GDP growth in Q1. The BoE is simultaneously conducting quantitative tightening. The next MPC meeting is April 30 — the same date as the FOMC and ECB meetings — creating a potential volatility event in late April.
The USD/CAD daily chart Fibonacci retracement is anchored between the 1.4125 swing high (1.000) and the 1.3479 swing low (0.000), representing a 646-pip retracement range. The key levels are: 0.236 at 1.3631, 0.382 at 1.3726, 0.500 at 1.3802, 0.618 at 1.3878, 0.786 at 1.3988, and the full 1.000 retrace at 1.4125.
Current price at 1.3935 sits between the 0.618 (1.3878) and 0.786 (1.3988) Fibonacci levels, having confirmed the 0.618 as support on its most recent test. The 0.786 at 1.3988 is the next defined resistance target. Above 1.3988, there is a gap in structural reference until the 1.000 retrace at 1.4125. The RSI at 66.52 has room to extend before reaching overbought conditions, and the MACD at +0.001 is in confirmed buy territory. The 5-day SMA at 1.3779 and 50-day SMA at 1.3748 are both below the current price and rising, providing dynamic support on pullbacks. The Fibonacci pivot at 1.3780 marks the floor for any meaningful correction to remain within the current bullish structure.
The Middle East conflict, centred on disruptions to shipping through the Strait of Hormuz, creates differentiated impacts across the four pairs in today’s report. For EUR/USD, the ECB explicitly cited the conflict as an upside risk to near-term inflation at its March 19 meeting. This justification for the rate hold at 2.0% removes any short-term prospect of further ECB easing, but has not been sufficient to support the euro against the broad USD strength driven by the Fed-hold narrative.
For GBP/USD, the BoE MPC noted that Middle East energy prices could push UK CPI back toward 3.0–3.5% in Q2 and Q3. This creates a stagflation scenario — higher inflation reducing purchasing power while growth remains subdued at ~0.1% quarterly. For NZD/USD, global risk-off flows generated by geopolitical uncertainty weigh on risk-sensitive commodity-linked currencies like the New Zealand dollar. For USD/CAD, higher crude oil prices from supply disruptions create mixed signals: Canada benefits as a crude oil exporter in theory, but global risk-off behaviour and the wider Fed–BoC rate differential mean USD/CAD’s bullish trend has continued regardless.
