. Daily FX Analysis - Explore currency markets amid economic shifts.

Daily FX Analysis – Explore currency markets amid economic shifts.

Daily FX Analysis – Explore currency markets amid economic shifts.

01 Apr 2024

Introduction

EUR/USD is trading lower below 1.0800, with investors awaiting US PMI data. Currently hovering near 1.0787, the pair faces pressure from a stronger USD. ECB’s Stournaras suggests the possibility of four interest rate cuts in 2024. Meanwhile, GBP/USD remains around 1.2530, with focus on US ISM Manufacturing PMI. The Australian Dollar retraces losses amid positive Chinese PMI, while USD/JPY steadies below 151.50 amid Japanese verbal intervention.

Markets In Focus Today – EUR/USD

EUR/USD trades on a weaker note below 1.0800, investors await the US PMI data.

EUR/USD trades in negative territory around 1.0787 on the firmer USD. The US Core PCE was up 0.3% MoM and 2.8% YoY, matching the market estimation. ECB’s Stournaras said that a total of four interest rate cuts are possible in 2024. The EUR/USD pair trades on a weaker note near 1.0787 on the renewed US dollar (USD) demand during the early Asian session on Monday. The higher-for-longer stance from the Federal Reserve (Fed) provides some support to the Greenback and weighs on the EUR/USD pair. Meanwhile, the US Dollar Index (DXY) currently trades around 104.52, gaining 0.03% on the day. The Commerce Department’s Bureau of Economic Analysis revealed on Friday that the US Personal Consumption Expenditures (PCE) Price Index rose 0.3% MoM in February, in line with expectations. On an annual basis, February PCE inflation advanced 2.5% YoY in February.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0824 | Negative Crossover | Bearish
  • MA 20 : 1.0841 | Negative Crossover | Bearish
  • MA 50 : 1.0848 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.0831 | Negative Crossover | Bearish
  • MA 20 : 1.0870 | Negative Crossover | Bearish
  • MA 50 : 1.0832 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 40.2612 | Sell Zone | Bearish

Stochastic   Oscillator : 9.3870 | Sell Zone | Positive

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 : 1.0802 | Take Profit : 1.0737 | Stop Loss : 1.0854

GBP/USD

GBP/USD hovers around 1.2530 after paring gains, focus on US ISM Manufacturing PMI.

GBP/USD remains in the positive territory after trimming daily gains on Monday.US ISM Manufacturing PMI is expected to improve to 48.4 in March, from 47.8 prior.GBP could face a struggle due to the speculation of the BoE initiating three quarter-point rate cuts in 2024.GBP/USD trims intraday gains, remaining higher around 1.2530 during the Asian hours on Monday. US Dollar (USD) recovers its daily losses on risk aversion ahead of ISM Manufacturing Purchasing Managers Index (PMI) data from the United States (US) scheduled to be released later in the North American session, capping the advance of the GBP/USD pair. However, the US Dollar Index (DXY) encountered difficulties following dovish comments from Federal Reserve (Fed) Chairman Jerome Powell on Friday. Powell remarked that recent US inflation data was in line with expectations, supporting the Fed’s position on potential interest rate cuts throughout 2024. Fed officials maintain projections of three rate cuts this year. Market participants anticipate the first of these cuts to materialize at the June meeting.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2651 | Negative Crossover | Bearish
  • MA 20 : 1.2673 | Negative Crossover | Bearish
  • MA 50 : 1.2671 | Negative Crossover | Bearish

Simple :

  • MA 10 : 1.2653 | Negative Crossover | Bearish
  • MA 20 : 1.2712 | Negative Crossover | Bearish
  • MA 50 : 1.2673 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 42.1847 | Neutral Zone | Bearish

Stochastic   Oscillator : 17.6609 | Sell Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 1.2654 | Take Profit : 1.2568 | Stop Loss : 1.2720

AUD/USD

Australian Dollar trims intraday gains amid a firmer US Dollar, ISM PMI awaited.

Australian Dollar gains ground on encouraging Chinese PMI data. RBA Meeting Minutes will be awaited to be released on Tuesday. China’s Caixin Manufacturing PMI came in at 51.1, against the expected 51.0 and 50.9 prior. US Dollar faces challenges after dovish remarks from Fed Chair Powell.The Australian Dollar (AUD) retraces its recent losses on Monday, possibly bolstered by positive Chinese Purchasing Managers Index (PMI) figures. Moreover, the US Dollar (USD) faced downward pressure due to decreased US Treasury yields, lending support to the AUD/USD pair. Trading activity is anticipated to be subdued due to Easter Monday. The Australian Dollar encountered challenges amidst weaker Consumer Inflation Expectations, possibly signaling expectations for interest rate cuts by the Reserve Bank of Australia (RBA) in late 2024. Investors are likely to closely monitor the release of the RBA Meeting Minutes scheduled for Tuesday.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6535 | Negative Crossover | Bearish
  • MA 20 : 0.6544 | Negative Crossover | Bearish
  • MA 50 : 0.6557 | Negative Crossover | Bearish

Simple :

  • MA 10 : 0.6535 | Negative Crossover | Bearish
  • MA 20 : 0.6559 | Negative Crossover | Bearish
  • MA 50 : 0.6545 | Negative Crossover | Bearish

RSI (Relative Strength Index) : 44.9865 | Neutral Zone | Neutral

Stochastic   Oscillator : 22.2342 | Sell Zone | Positive

Resistance   And Support Levels :

  • R1 : 0.6628 R2 : 0.6673
  • S1 : 0.6483 S2 : 0.6438

Overall Sentiment : Bearish Market Direction : Sell

Trade Suggestion : Limit Sell : 0.6548 | Take Profit : 0.6484 | Stop Loss : 0.6596

USD/JPY

USD/JPY holds steady below 151.50 amid Japan’s verbal intervention.

USD/JPY is keeping its range below 151.50 in the Asian session on Monday, as the Japanese Yen stays afloat on some verbal intervention from Japanese officials. Further, a broadly subdued US Dollar and light trading keep the pair in limbo ahead of the US PMI data. Japanese Finance Minister Shunichi Suzuki made remarks on Friday emphasizing the importance of stable currency movements aligned with economic fundamentals. He expressed concern about rapid fluctuations in foreign exchange (FX) markets, attributing speculative activity to these movements. Suzuki stated that authorities are closely monitoring FX developments with a strong sense of urgency and are prepared to take necessary measures to address disorderly FX movements.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 150.9770 | Positive Crossover | Bullish
  • MA 20 : 150.4174 | Positive Crossover | Bullish
  • MA 50 : 149.3462 | Positive Crossover | Bullish

Simple :

  • MA 10 : 151.3186 | Positive Crossover | Bullish
  • MA 20 : 149.8109 | Positive Crossover | Bullish
  • MA 50 : 149.4443 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 62.7908 | Buy Zone | Bullish

Stochastic   Oscillator : 87.8072 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 152.0153 R2 : 153.3100
  • S1 : 147.8240 S2 : 146.5293

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 150.81 | Take Profit : 151.83 | Stop Loss : 150.23

Elsewhere In The Forex Market

NZD/USD down 0.02% to 0.5978, The USD/CHF up 0.02% to 0.9016. The EUR/GBP up 0.03% at 0.8544. USD/CAD down 0.05% at 1.3529. AUD/NZD up 0.26% at 1.0908, The USD/CNY up 0.14% at 7.2300, AUD/SEK up 0.33% at 6.9672, at the time of writing.

Key Economic Events & Data Release Today:

(USD) Manufacturing PMI (Mar) Forecast 52.8, Previous 52.2 at 19:15. (USD) ISM Manufacturing PMI (Mar) Forecast –48.5, Previous –52.2 at 19:30.