. Daily FX Analysis - Forex pairs brace for crucial CPI.

Daily FX Analysis – Forex pairs brace for crucial CPI.

Daily FX Analysis – Forex pairs brace for crucial CPI.

10 Apr 2024

Introduction

In European trading hours on Wednesday, GBP/USD remains relatively unchanged below 1.2700, with investors adopting a cautious stance ahead of the US Consumer Prices Index data release. Despite initial resistance above the 1.2700 level, the pair retains a modestly positive tone, reflecting market anticipation of steady inflation rates. Meanwhile, EUR/USD hovers near 1.0850 amidst subdued market sentiment, awaiting key US CPI data and Fed Minutes. USD/CHF plunges to 0.9000 on buoyant market sentiment, while the Australian Dollar edges lower against a firmer US Dollar, with focus on CPI figures.

Markets In Focus Today – GBP/USD

GBP/USD trades modestly flat below 1.2700, awaits US CPI data.

GBP/USD trades modestly flat below 1.2700 in European trading hours on Wednesday. The pair lacks a clear directional bias amid a stabilizing US Dollar and a typical caution trading heading into the US inflation data release. FOMC Minutes and Fedpseak will also grab attention. The Pound has found some supply at levels right above the 1.2700 area before pulling back with investors cutting back short USD positions ahead of the US inflation release. The pair, however, remains moderately positive for the second consecutive day.All eyes are on the US Consumer Prices Index data, due on Wednesday, which is expected to confirm that price pressures remain steady well above the Fed’s target rate.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.2651 | Positive Crossover | Bullish
  • MA 20 : 1.2658 | Positive Crossover | Bullish
  • MA 50 : 1.2663 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.2631 | Positive Crossover | Bullish
  • MA 20 : 1.2659 | Positive Crossover | Bullish
  • MA 50 : 1.2664 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 52.5266 | Buy Zone | Bullish

Stochastic   Oscillator : 59.3696 | Buy Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 1.2667 | Take Profit : 1.2735 | Stop Loss : 1.2626

EUR/USD

EUR/USD hovers near 1.0850, with US CPI in focus.

EUR/USD is extending its side trend into the European morning on Wednesday, as the US Dollar consolidates recent losses ahead of the key US CPI inflation data. A cautious market mood leaves the pair in limbo. Fed Minutes and Fedspeak are also eyed. EUR/USD traded slightly on the defensive despite hitting new multi-week tops in the 1.0885–1.0890 band earlier in the session, always against the backdrop of another uneventful session and vacillating price action in the Greenback. Meanwhile, diminishing yields on both sides of the ocean accompanied humble losses in spot amidst an unchanged monetary policy framework, firm conviction that the ECB will hold its hand at its event later in the week, and increasing prudence ahead of the release of the US CPI and the FOMC Minutes, both due on Wednesday.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 1.0836 | Positive Crossover | Bullish
  • MA 20 : 1.0838 | Positive Crossover | Bullish
  • MA 50 : 1.0844 | Positive Crossover | Bullish

Simple :

  • MA 10 : 1.0817 | Positive Crossover | Bullish
  • MA 20 : 1.0838 | Positive Crossover | Bullish
  • MA 50 : 1.0830 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 51.9650 | Buy Zone | Bullish

Stochastic   Oscillator : 67.0062 | Buy Zone | Negative

Resistance   And Support Levels :

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

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 1.0867 | Take Profit : 1.0920 | Stop Loss : 1.0833

USD/CHF

USD/CHF tumbles to 0.9000 on upbeat market sentiment, US Inflation in spotlight.

USD/CHF drops sharply to 0.9000 as US Dollar slumps ahead of US Inflation data.S&P 500 opens on a positive note, indicating demand for risk-perceived assets.The SNB is expected to cut interest rates again as Swiss inflation remains below 2%.The USD/CHF pair falls sharply to 0.9010 . The Swiss Franc asset weakens as the market sentiment remains cheerful even though traders pare bets supporting Federal Reserve (Fed) rate cuts from the June meeting. Market expectations for the Fed reducing rates ease as strong United States Nonfarm Payrolls (NFP) data strengthens the inflation outlook.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.9022 | Positive Crossover | Bullish
  • MA 20 : 0.8980 | Positive Crossover | Bullish
  • MA 50 : 0.8884 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.9033 | Positive Crossover | Bullish
  • MA 20 : 0.8981 | Positive Crossover | Bullish
  • MA 50 : 0.8860 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 64.7917 | Buy Zone | Bullish

Stochastic   Oscillator : 71.3201 | Buy Zone | Neutral

Resistance   And Support Levels :

  • R1 : 0.9068 R2 : 0.9148
  • S1 : 0.8807 S2 : 0.8726

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Stop Buy : 0.9038 | Take Profit : 0.9055 | Stop Loss : 0.9027

AUD/USD

Australian Dollar edges lower amid a firmer US Dollar, focus on CPI data.

Australian Dollar marked a four-week high at 0.6644 on Tuesday. Australian currency strengthens on investors’ doubts surrounding the RBA’s rate cuts in 2024.US Dollar receives downward pressure ahead of US CPI and FOMC minutes. The Australian Dollar (AUD) attempts to extend gains for the third consecutive session on Wednesday. The AUD/USD pair reached a four-week high at 0.6644 in the previous session as the US Dollar (USD) faced a struggle, which could be attributed to the decline in the US Treasury yields. The Australian Dollar gains strength as investors become increasingly skeptical about the necessity for the Reserve Bank of Australia (RBA) to implement interest rate cuts in 2024, given the anticipation of the Federal Reserve (Fed) extending its higher interest rate stance.

Technical   Overview With Chart :

Moving Averages :

Exponential :

  • MA 10 : 0.6581 | Positive Crossover | Bullish
  • MA 20 : 0.6566 | Positive Crossover | Bullish
  • MA 50 : 0.6564 | Positive Crossover | Bullish

Simple :

  • MA 10 : 0.6562 | Positive Crossover | Bullish
  • MA 20 : 0.6555 | Positive Crossover | Bullish
  • MA 50 : 0.6544 | Positive Crossover | Bullish

RSI (Relative Strength Index) : 61.1475 | Buy Zone | Bullish

Stochastic   Oscillator : 85.4182 | Buy Zone | Neutral

Resistance   And Support Levels :

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

Overall Sentiment : Bullish Market Direction : Buy

Trade Suggestion : Limit Buy : 0.6613 | Take Profit : 0.6675 | Stop Loss : 0.6582

Elsewhere In The Forex Market

NZD/USD up 0.18% to 0.6070, The USD/JPY up 0.03% to 151.78. The EUR/GBP down 0.06% at 0.8558. USD/CAD down 0.07% at 1.3562. AUD/NZD down 0.21% at 1.0915, The USD/CNY up 0.02% at 7.2324, AUD/SEK down 0.12% at 6.9877, at the time of writing.

Key Economic Events & Data Release Today:

(NZD) RBNZ Rate Statement at 07:30. (USD) CPI (YoY) (Mar) Forecast 3.4%, Previous 3.2% at 18:00. (USD) Core CPI (MoM) (Mar) Forecast 0.3%, Previous 0.4% at 18:00. (USD) CPI (MoM) (Mar) Forecast 0.3%, Previous 0.4% at 18:00. (CAD) BoC Interest Rate Decision Forecast 5.00%, Previous 5.00% at 19:25. (CAD) BoC Monetary Policy Report at 19:15. (USD) FOMC Meeting Minutes at 23:30.