. Daily FX Analysis - EUR/USD high, GBP/USD eyes December.

Daily FX Analysis – EUR/USD high, GBP/USD eyes December.

Daily FX Analysis – EUR/USD high, GBP/USD eyes December.

08 Mar 2024

Introduction

EUR/USD retraces from recent two-month highs around 1.0950 as market attention shifts to the upcoming US Nonfarm Payrolls (NFP) data. The pair surged on Thursday, fueled by ECB expectations and a weakening US Dollar following dovish remarks from Fed Chair Jerome Powell. Meanwhile, GBP/USD targets December’s high at 1.2828, supported by improved risk sentiment and lower US Treasury yields. The Australian Dollar rises on the prospect of a softer USD, with Australia’s S&P/ASX 200 Index reaching record highs. USD/JPY loses momentum below 148.00 as a weakening USD and hawkish comments from the Bank of Japan drive the pair to fresh five-week lows. The US NFP report is eagerly anticipated by traders.

Markets In Focus Today – EUR/USD

EUR/USD eases off two-month highs near 1.0950, US NFP awaited.

EUR/USD is retreating from two-month highs near 1.0950 in the European morning on Friday. The pair rallied on Thursday, bolstered by prospects of movement from the ECB and an easing US Dollar on the back of a dovish tone from Fed Chair Jerome Powell. US NFP coming up next. Once again, EUR/USD succeeded in surpassing the crucial 1.0900 threshold, climbing to multi-week highs amid intensified selling pressure that weighed heavily on the US Dollar (USD). This pressure was particularly pronounced after Chair Jerome Powell’s testimony fell in line with investors’ expectations, while disappointing readings from the US labor market also added to the sour mood surrounding the Greenback. On the latter, the USD Index (DXY) declined for the fifth consecutive session, lingering around five-week lows just above the 103.00 milestone, accompanied by further decreases in US yields. This trend persisted against the backdrop of persevering speculation regarding a potential rate cut by the Fed at its June 12 gathering.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0878 | Positive Crossover | Bullish
  • MA 20 : 1.0851 | Positive Crossover | Bullish
  • MA 50 : 1.0846 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.0868 | Positive Crossover | Bullish
  • MA 20 : 1.0823 | Positive Crossover | Bullish
  • MA 50 : 1.0856 | Positive Crossover | Bullish

RSI (Relative Strength Index): 67.1977 | Buy Zone | Bullish

Stochastic   Oscillator : 94.8659 | Buy Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.0876 R2 : 1.0924
  • S1 : 1.0722 S2 : 1.0674

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 1.0926 | Take Profit: 1.1008 | Stop Loss: 1.0880

GBP/USD

GBP/USD Price Appreciates to near 1.2810 followed by December’s high.

GBP/USD targets December high at 1.2828 and August high at 1.2841. Technical analysis suggests a confirmation of the bullish trend for the pair. The psychological level of 1.2800 appears as an immediate support level.GBP/USD seems to continue its winning streak that began on March 1, hovering around 1.2810 during the Asian session on Friday. The GBP/USD pair receives upward support as the US Dollar (USD) faces challenges on improved risk appetite amid lower US Treasury yields. The GBP/USD pair finds the immediate barriers at December’s high at 1.2828 and August’s high at 1.2841. A break above these levels could support the pair to test the major level of 1.2850, followed by the psychological resistance area around the 1.2900 level.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2719 | Positive Crossover | Bullish
  • MA 20 : 1.2688 | Positive Crossover | Bullish
  • MA 50 : 1.2657 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.2704 | Positive Crossover | Bullish
  • MA 20 : 1.2660 | Positive Crossover | Bullish
  • MA 50 : 1.2674 | Positive Crossover | Bullish

RSI (Relative Strength Index): 68.2068 | Buy Zone | Bullish

Stochastic   Oscillator : 92.7156 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 1.2735 R2 : 1.2794
  • S1 : 1.2541 S2 : 1.2482

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 1.2793 | Take Profit: 1.2912 | Stop Loss: 1.2730

AUD/USD

Australian Dollar rises amid a muted US Dollar, US Nonfarm Payrolls eyed.

Australian Dollar consolidates with a positive bias ahead of US Nonfarm Payrolls. Australia’s S&P/ASX 200 Index rose to new record highs, following a tech-led rally on Wall Street overnight. Fed Chair Powell reiterated that the central bank could initiate rate cuts at some point this year. The Australian Dollar (AUD) continues its winning streak for a third consecutive session on Friday on a possibility of the US Dollar (USD) moving downward. Federal Reserve (Fed) Chair Jerome Powell, in his second day of testimony before the US Congress, reaffirmed the central bank’s position. Powell hinted at potential cuts in borrowing costs sometime this year. However, he emphasized that such actions would hinge on the inflation trajectory aligning with the Fed’s target of 2%.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6559 | Positive Crossover | Bullish
  • MA 20 : 0.6549 | Positive Crossover | Bullish
  • MA 50 : 0.6564 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.6542 | Positive Crossover | Bullish
  • MA 20 : 0.6534 | Positive Crossover | Bullish
  • MA 50 : 0.6582 | Positive Crossover | Bullish

RSI (Relative Strength Index): 62.5695 | Buy Zone | Bullish

Stochastic   Oscillator : 89.2575 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.6580 R2 : 0.6620
  • S1 : 0.6453 S2 : 0.6413

Overall Sentiment: Bullish Market Direction: Buy

Trade Suggestion: Limit Buy: 0.6617 | Take Profit: 0.6689 | Stop Loss: 0.6577

USD/JPY

USD/JPY loses momentum near fresh five-week lows below 148.00, US NFP data looms.

USD/JPY loses traction near 147.70 amid the softer USD and BoJ’s hawkish comments. BOJ policymakers said the economy was moving towards its 2% target, raising the chance that BoJ will end its negative rate. The US Nonfarm-Payrolls will be a closely watched event for traders. The USD/JPY pair drops to fresh five-week lows below the 148.00 mark during the early Asian trading hours on Friday. A weaker US Dollar (USD) and growing speculation that the Bank of Japan (BoJ) will exit from an ultra-loose monetary policy stance lift the Japanese Yen (JPY) and exert some selling pressure on the USD/JPY. At press time, the pair is trading at 147.70, down 0.26% on the day. The Bank of Japan’s (BOJ) governor and board members said on Thursday the economy was moving towards the central bank’s 2% inflation target, raising the possibility that the BOJ will end its negative interest rates for the first time since 2007.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 149.3752 | Negative Crossover | Bearish
  • MA 20 : 149.4266 | Negative Crossover | Bearish
  • MA 50 : 148.4693 | Negative Crossover | Bearish

Simple :

  • MA 10 : 149.7776 | Negative Crossover | Bearish
  • MA 20 : 149.9909 | Negative Crossover | Bearish
  • MA 50 : 147.9305 | Positive Crossover | Bullish

RSI (Relative Strength Index): 39.5700 | Sell Zone | Bearish

Stochastic   Oscillator : 14.4910 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 150.8153 R2 : 151.9920
  • S1 : 147.0060 S2 : 145.8293

Overall Sentiment: Bearish Market Direction: Sell

Trade Suggestion: Limit Sell: 147.74 | Take Profit: 146.35 | Stop Loss: 148.79

Elsewhere In The Forex Market

NZD/USD down 0.02% to 0.6172, The USD/CHF down 0.03% to 0.8774. The EUR/GBP is down 0.01% at 0.8546. USD/CAD is down 0.09% at 1.3446. AUD/NZD is up 0.2% at 1.0740, The USD/CNY is up 0.03% at 7.1987, and AUD/SEK is up 0.16% at 6.7784, at the time of writing.

Key Economic Events & Data Release Today:

(EUR) GDP (QOQ) (Q4) Actual 0.0%, Previous –0.1% at 05:00. (USD) Average Hourly Index (MoM) (Feb) Forecast 0.2%, Previous 0.6% at 08:30. (USD) Nonfarm Payrolls (Feb) Forecast 198K, Previous 353K at 08:30. (USD) Unemployment Rate (Feb) Forecast 3.7%, Previous 3.7% at 08:30. (CAD) Employment Change (Feb) Forecast 21.1K, Previous 37.3K at 08:30.