. Daily FX Analysis - Euro Struggles, Pound Dips.

Daily FX Analysis – Euro Struggles, Pound Dips.

Daily FX Analysis – Euro Struggles, Pound Dips.

30 Apr 2024

Introduction

EUR/USD struggles near 1.0700 following German GDP figures, facing renewed USD demand. With the Eurozone CPI and FOMC policy meeting ahead, traders exercise caution. The Pound Sterling dips to 1.2530 amid Fed policy uncertainty, while NZD/USD retreats near 0.5950 due to USD strength and a decline in ANZ Business Confidence. USD/CAD trades modestly higher above 1.3650 ahead of Canadian GDP data and the FOMC decision, buoyed by the Fed’s hawkish stance on rates.

Markets In Focus Today – EUR/USD

EUR/USD stays weak near 1.0700 after German GDP data.

EUR/USD comes under renewed selling pressure amid a modest pickup in USD demand.The technical setup warrants caution for bearish traders ahead of the key Eurozone CPI.The market focus will then shift to the FOMC policy decision, scheduled for Wednesday.The EUR/USD pair meets with some supply during the Asian session on Tuesday and erodes a part of the previous day’s gains amid the emergence of fresh US Dollar (USD) buying. Spot prices, however, remain in a familiar range held over the past week or so and currently trade around the 1.0700 round-figure mark. Hawkish Federal Reserve (Fed) expectations help revive the US Dollar (USD) demand. This, along with bets that the European Central Bank (ECB) will cut interest rates in June, turn out to be key factors exerting some downward pressure on the EUR/USD pair. Traders, however, seem reluctant to place aggressive directional bets ahead of the Eurozone consumer inflation figures on Tuesday and the outcome of a two-day FOMC policy meeting on Wednesday.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0699 | Negative Crossover | Bearish
  • MA 20 : 1.0720 | Negative Crossover | Bearish
  • MA 50 : 1.0771 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.0685 | Positive Crossover | Bullish
  • MA 20 : 1.0721 | Negative Crossover | Bearish
  • MA 50 : 1.0801 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 44.8772 | Neutral Zone | Neutral

Stochastic   Oscillator : 36.02 | Sell Zone | Negative

Resistance   And Support Levels :

  • R1 : 1.0928 R2 : 1.0978
  • S1 : 1.0765 S2 : 1.0715

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 1.0732 | Take Profit : 1.0676 | Stop Loss : 1.0773

GBP/USD

Pound Sterling drops amid uncertainty ahead of Fed’s policy decision.

The Pound Sterling falls to 1.2530 as investors turn cautious ahead of the Fed’s policy announcement.Investors will also focus on US Manufacturing PMI and labor market data in addition to the Fed’s policy.Market expectations for UK interest rates will guide the Pound Sterling.The Pound Sterling (GBP) edges down from a two-week high of 1.2570 but holds above the psychological support of 1.2500 against the US Dollar (USD) in Tuesday’s London session. The GBP/USD pair comes under pressure as investors await the US Federal Reserve’s (Fed) monetary policy announcement on Wednesday for fresh guidance. A data-packed week in the United States will keep the US Dollar on tenterhooks. On the other side of the Atlantic, the United Kingdom’s economic calendar is light. Therefore, market speculation for the Bank of England’s (BoE) interest rate policy on May 9 will guide the Pound Sterling. The BoE is expected to maintain the status quo, but guidance on interest rates is expected to be slightly on the dovish side.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2495 | Positive Crossover | Bullish
  • MA 20 : 1.2516 | Positive Crossover | Bullish
  • MA 50 : 1.2576 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.2462 | Positive Crossover | Bullish
  • MA 20 : 1.2514 | Positive Crossover | Bullish
  • MA 50 : 1.2620 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 49.4280 | Buy Zone | Bullish

Stochastic   Oscillator : 64.3311 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 1.2819 R2 : 1.2894
  • S1 : 1.2576 S2 : 1.2501

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Stop Sell : 1.2515 | Take Profit : 1.2418 | Stop Loss : 1.2594

NZD/USD

NZD/USD drops to near 0.5950 ahead of Fed decision on Wednesday.

NZD/USD loses ground due to Tuesday’s rebound in the US Dollar.The hawkish remarks from Fed officials indicate that there is no immediate need for interest rate cuts.ANZ Business Confidence has marked its lowest level since last September, indicating a significant economic deterioration.NZD/USD retraces its recent gains, trading around 0.5950 during the Asian session on Tuesday. The rebound in the US Dollar (USD) undermines the NZD/USD pair, which could be attributed to the hawkish remarks from US Federal Reserve (Fed) officials, indicating no immediate need for rate cuts.In New Zealand, the ANZ Business Confidence fell to 14.9 in April from March’s reading of 22.9, marking the third consecutive month of decline and hitting the lowest level since last September. This latest data suggests a notable weakening of the economy, likely influenced by the Reserve Bank of New Zealand’s (RBNZ) decision to raise interest rates. The Economic Times reported on Monday that Fed Chair Jerome Powell said it would probably take “longer than expected” to be confident that inflation is moving toward the central bank’s 2% target.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.5940 | Positive Crossover | Bullish
  • MA 20 : 0.5955 | Positive Crossover | Bullish
  • MA 50 : 0.6010 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.5928 | Positive Crossover | Bullish
  • MA 20 : 0.5955 | Positive Crossover | Bullish
  • MA 50 : 0.6035 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 44.2345 | Neutral Zone | Neutral

Stochastic   Oscillator : 64.04 | Buy Zone | Negative

Resistance   And Support Levels :

  • R1 : 0.6149 R2 : 0.6211
  • S1 : 0.5951 S2 : 0.5890

Overall Sentiment : Neutral Market Direction : Buy

Trade Suggestion : Stop Buy : 0.5996 | Take Profit : 0.6071 | Stop Loss : 0.5951

USD/CAD

USD/CAD posts modest gains above 1.3650 ahead of Canadian GDP data.

USD/CAD trades on a stronger note near 1.3665 on Tuesday. The FOMC is widely expected to hold rates steady in its current 5.25%–5.50% range on Wednesday.The further downside of oil prices weighs on the commodity-linked Loonie. The USD/CAD pair posts modest gains around 1.3665 on Tuesday during the early Asian trading hours. A modest rebound of the US Dollar (USD) provide some support to the pair. Meanwhile, the decline in oil prices weighs on the commodity-linked Loonie. Investors will keep an eye on the Canadian February Gross Domestic Product (GDP) growth number. The attention will shift to the Federal Open Market Committee’s (FOMC) interest rate decision on Wednesday. The US Federal Reserve’s (Fed) policymakers see no urgency in lowering rates. Fed Governor Michelle Bowman said she sees “upside risks” to inflation. Meanwhile, Minneapolis Fed President Neel Kashkari floated the possibility of having no rate cuts this year. Atlanta Fed’s Raphael Bostic said he could favor hiking them if inflation gets worse. The US Fed’s higher-for-longer rate narrative lifts the Greenback and creates a tailwind for the USD/CAD pair.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.3689 | Negative Crossover | Bearish
  • MA 20 : 1.3672 | Negative Crossover | Bearish
  • MA 50 : 1.3610 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.3703 | Negative Crossover | Bearish
  • MA 20 : 1.3679 | Negative Crossover | Bearish
  • MA 50 : 1.3592 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 55.2219 | Neutral Zone | Neutral

Stochastic   Oscillator : 35.7754 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 1.3598 R2 : 1.3644
  • S1 : 1.3450 S2 : 1.3404

Overall Sentiment : Neutral Market Direction : Sell

Trade Suggestion : Stop Sell : 1.3639 | Take Profit : 1.3571 | Stop Loss : 1.3699

Elsewhere In The Forex Market

AUD/USD down 0.61% to 0.6525, The USD/JPY up 0.35% to 156.85. The EUR/GBP up 0.02% at 0.8535. USD/CHF up 0.35% at 0.9135. AUD/NZD up 0.01% at 1.0995, The USD/CNY up 0.12% at 7.2402, AUD/SEK down 0.16% at 7.1620, at the time of writing.

Key Economic Events & Data Release Today:

(AUD) Retail Sales (MoM) (Mar) Forecast 0.2%, Previous 0.3% at 07:00. (EUR) German Unemployment Change (Apr) Forecast 7K, Previous 4K at 13:25. (EUR) German GDP (QoQ) (Q1) Forecast 0.1%, Previous 0.6% at 13:30. (EUR) GDP (QoQ) (Q1) Forecast 0.1%, Previous 0.0% at 14:00 . (EUR) CPI (YoY) (Apr) Forecast 2.4%, Previous 2.4% at 14:00. (CAD) GDP (MoM) (Feb) Forecast 0.3%, Previous 0.6% at 18:00. (CAD) GDP (MoM) (Mar) at 18:01.