. Fundamental Analysis Report With Charting Trends - 03 March 2023

FUNDAMENTAL ANALYSIS REPORT WITH CHARTING TRENDS – 03 MARCH 2023

FUNDAMENTAL ANALYSIS REPORT WITH CHARTING TRENDS – 03 MARCH 2023

03 Mar 2023

MARKET UPDATE:

Another day, another batch of impressive U’S data, but this time it’s good news for investors since the US market indices finished the day strongly in the black. The Dow outperformed the S&P and Nasdaq, which both ended the day up by 0.75%. In line with US Treasury yields, the US dollar increased in value. The market is still carefully watching this month’s Fed meeting; some analysts have even predicted that the FOMC may increase its rate by 50 basis points.

Although there has been considerable market volatility over the past several weeks, one constant has been the strength of the US data prints and the growing confidence that higher rates will persist domestically. The benchmark 10-year US Treasury note is currently trading above 4%, while the highly watched 2-year note is trading at highs not seen in 15 years, close to the 5% mark. US Treasury rates have surged decisively to the upside. Some currency traders believe that the major pairs are lagging slightly and are looking for some bigger moves in the coming weeks, particularly if the current pattern in economic indicators continues and it begins to push next week’s crucial Non-Farm Payrolls number even further up the pole in terms of importance.

 What took place during the US session?

US unemployment claims for the most recent reporting period were 190K, exceeding both the 196K forecast and the 192K total from the prior reporting period. The outcome points to a growing labor market, which could have positive effects on the USD.

 How does this affect the Asia Session?

Given that the predicted rise in gold, based on the most recent inflation in the Eurozone, conflicts with Australia’s moderating price increases, the session is likely to witness mixed price action, with the AUD serving as a highlight.

The Dollar Index (DXY)

Key news events today

ISM Services PMI  

What can we expect from DXY today?

Forecasted data of 54.5 for US ISM Services PMI data indicates a slight decline from the previous 55.2. Actual data meeting/exceeding forecast can positively impact USD while falling short can lead to a negative impact.

24 Hours from Now Bias

Mildly Bearish

Gold (XAU) (XAU)

today’s major news events

No significant news stories.

What can we anticipate from gold right now?

The stubbornly high inflation in the Eurozone could increase the demand for gold as a hedge against price increases. This may lead to a rise in the price of gold.

24 Hours from Now Bias

Bearish

Global Markets:

Asian stock markets declined 0.06% on the Nikkei, 0.05% on the Shanghai Composite, 0.92% on the Hang Seng, and 0.05% on the ASX.

European equities closed in green, the DAX futures at 0.15%, CAC 40 in green at 0.69%, and FTSE closes at 0.37%.

The US stock market rose Dow jones up 1.05%, S&P 500 up at 0.79%, Nasdaq 100 in up at 0.52%.                    

commodities: Brent oil at $84.30 (down 0.54%), WTI oil at $77.78 (down 0.49%), silver at $21.15 (up 1.19%), and gold at $1846.13 (up 0.57%).

News & Data:

  1. (USD) ISM Non-Manufacturing PMI (Feb) Forecast 54.5, Previous 55.2 at 20:30
  2. (GBP) Service PMI (Feb) Actual 53.5, Forecast 53.3, Previous 48.7 at 15:00
  3. (GBP) Composite PMI (Feb) Actual 53.1, Forecast 53.0, Previous 48.5 at 15:00
  4. (EUR) Service PMI (Feb) Actual 52.7, Forecast 53.0, Previous 50.08 at 14:30
  5. (USD) Fed Waller Speaks at 02:30

Technical Outlook

GBPUSD

Price has descended to test our first support at 1.1930 after reversing from our first resistance at 1.21390. Because price has reacted to and bounced off its numerous times in the past, our first support is a very strong overlap support. If prices were to break this first support, the next important support to watch out for is the most recent swing low at 1.1840.

Our middle resistance, which is a double swing high resistance, is located at 1.2139 in terms of resistance. Breaking this might cause a move up to our first resistance, 1.2256, as well as the descending resistance trend line.

EURUSD

Price has fallen because of reacting to our first resistance around 1.06659, which corresponds to the 23.6% Fibonacci retracement. While the price is currently below the Ichi Moku cloud, there is a strong bearish momentum.

Prices might potentially move further to our first support at 1.04789, where the overlap support resides if they were to break the intermediate support at 1.0534.

AUDUSD

Prices are decreasing in accordance with a descending resistance line and are currently approaching our first support around 0.66402, which is a multiple-swing low support and a 50% Fibonacci retracement. It’s important to note that the price has also reacted off the overlap resistance and 23.6% Fibonacci retracement of the intermediate resistance at 0.67739.

Prices might fall further to 0.65493, a pullback support that corresponds with the 61.8% Fibonacci retracement if they were to breach the first support.

USDJPY

Our ascending trend line is showing us a nice price increase. Our first obstacle, a significant overlap resistance at 137.933, may be reached by the price.

Our first support, which is overlap support, is visible at 134.55. A break of that might cause a decline to the second support level at 132.81. We can also observe that the Stochastic, which historically appears to react off the 96% level, shows a bearish divergence.

S&P 500 

Price is currently testing our first support around 3939, and this might lead to a bounce that propels price up to our first resistance, a pullback barrier, and a 50% Fibonacci Retracement, at 4031. The price might push up to our second resistance at 4097, which is an overlapping barrier if it were to break through this level.

Yet, if the price were unable to overcome our first resistance, it might eventually fall to our first support at 2883.

BRENT CRUDE OIL

An uptrend will start as soon, as the market rises above the resistance level 86.10, which will be followed by moving up to the resistance level 88,98.

The downtrend may be expected to continue, while the market is trading below the resistance level of 80,00, which will be followed by reaching the support level of 76,20.

GOLD

A positive move may be imminent given that price has recently broken out of a negative channel. The first barrier, an overlap resistance in 1864, coincides with the 38.2% Fibonacci retracement. The next significant obstacle, in 1896, is a pullback resistance that coincides with the 61.8% Fibonacci retracement, and it would be reached if prices broke through that level.

We have two levels of support: an overlap support in 1809 and a second support in 1786, which nicely corresponds with our 50% Fibonacci retracement.

BITCOIN

Prices are being squeezed by an ascending support line against the overlap resistance at 23813, which is the first resistance. A rally up to the recent swing high resistance at 25185 might occur if prices were to break through the first resistance.

A decline to the first support at 22715, long-term overlap support, might occur if prices were to breach the rising support line.