2024-04-02 10:17

China reported an expansion in manufacturing activity after six months of contraction. The US reported the first expansion in manufacturing activity in over a year and a half. This week, markets will get a lot of data on the US labor market. The AUD/USD price analysis reveals a bullish narrative as the dollar relents after a strong rally. On Monday, the dollar strengthened after an upbeat manufacturing report reduced rate cut bets in the US. However, this report came after China’s positive manufacturing figures, which strengthened the Aussie and put a floor on excessive declines in the pair. On Sunday, China reported an expansion in manufacturing activity after six months of contraction. The purchasing managers’ index increased from 49.1 in February to 50.8 in March, beating forecasts. A value above 50 shows expansion. Consequently, it boosted the Australian dollar, which is a proxy for the yuan. Similarly, the US reported the first expansion in manufacturing activity in over a year and a half, boosting the dollar on Monday. Increased manufacturing activity reflects a robust economy despite higher interest rates. The Fed has kept interest rates high for some time to reduce demand in the economy which drives inflation. Therefore, if demand is still high, policymakers will hesitate to start lowering interest rates. Last week, data on consumer sentiment, GDP and home sales came in higher than expected, highlighting a robust economy. At the same time, inflation is on a downtrend. Therefore, there is more confidence that the US will avoid a recession caused by higher interest rates. This week, markets will get a lot of data on the US labor market. These figures might alter the rate-cut outlook. AUD/USD key events today US JOLTS job openings AUD/USD technical price analysis: Price escapes bullish channel, eyes new lows On the charts, the AUD/USD price has broken out of its bullish channel and might soon reach new lows. The bias is bearish as the price is making lower lows and highs below the 30-SMA. At the same time, the RSI trades in bearish territory below 50. –Are you interested to learn more about forex bonuses? Check our detailed guide- Bears broke below the channel support before retesting it and making new lows. This confirmed the channel breakout. However, the price is currently rising to retest the 0.6520 resistance level and the SMA. Given the bearish bias, it might reverse at this resistance and fall to the 0.6450 support level. https://www.forexcrunch.com/blog/2024/04/02/aud-usd-price-analysis-dollar-pares-pmi-led-gains/

2024-04-02 09:20

A rise in oil prices on Tuesday led to a slight recovery in the Canadian dollar. Companies in Canada expect low demand over the next year. The data revealed a significant improvement in US manufacturing. The USD/CAD outlook reveals a muted bearish undertone on Tuesday as the loonie gains momentum due to surged oil prices. In the previous session, the Canadian dollar weakened after a survey supported the view that the Bank of Canada would start cutting rates in June. Meanwhile, the dollar strengthened after upbeat manufacturing data. –Are you interested to learn more about low spread forex brokers? Check our detailed guide- A rise in oil prices on Tuesday led to a slight recovery in the Canadian dollar. Oil prices rose as the demand outlook brightened after upbeat manufacturing data in the US and China. The Canadian dollar weakened on Monday after a poor BoC business outlook survey. According to the poll, companies expect low demand over the next year. This is a sign that Canada’s economy might weaken further. Moreover, inflation has eased, putting pressure on the Bank of Canada to cut interest rates. At the same time, data revealed a slight improvement in Canadian manufacturing activity in March. However, the sector remained in contraction, slightly below 50. On the other hand, data revealed a significant improvement in US manufacturing that reduced rate cut expectations. Notably, manufacturing expanded after a long period of contraction. The ISM manufacturing PMI rose from 47.8 in February to 50.3 in March, moving from contraction to expansion. Manufacturing accounts for nearly 10% of the US economy. Therefore, an expansion in the sector shows a resilient and well-performing economy, giving the Fed more room to hold higher interest rates. Consequently, rate cut expectations fell after the report, boosting the dollar. USD/CAD key events today US JOLTS job openings USD/CAD technical outlook: Bears eye break below 30-SMA On the technical side, the USD/CAD price is on the brink of breaking below the 30-SMA as bears reverse the recent bullish move. Initially, bears had pushed the price down to the 0.618 Fib retracement level. However, they failed to break below this level, allowing bulls to take over. –Are you interested to learn more about forex bonuses? Check our detailed guide- Although bears challenge the new move, the bullish bias remains intact. The RSI is above 50. Therefore, if the SMA holds as support, the price will retest the 1.3600 resistance level. However, if bears breach the SMA, the price will likely retest the 1.3515 support level. Moreover, the bias would shift to bearish. https://www.forexcrunch.com/blog/2024/04/02/usd-cad-outlook-oil-rally-sparks-canadian-dollar-rebound/

2024-04-01 10:15

The core PCE price index showed inflation rising by a smaller 0.3%. Markets raised the chances of a Fed rate cut in June from 57% to 68.5%. The ECB’s Yannis Stournaras called for 100 bps in interest cuts this year. Today’s EUR/USD forecast gleams with bullish optimism as the dollar weakens, triggered by the anticipated decline in the Fed’s preferred inflation gauge. This decline fueled speculation of potential Fed rate cuts. –Are you interested to learn more about low spread forex brokers? Check our detailed guide- Notably, the core PCE price index showed inflation rising by 0.3%, a decline from the previous reading of 0.5%. As a result, markets raised the chances of a rate cut in June from 57% to 68.5%. At the same time, market participants expect 75 bps in interest rate cuts this year. After the report, Fed Chair Jerome Powell noted that inflation was similar to what the central bank wanted to see. From here, investors will now focus on the jobs report for March. A resilient economy will likely see the Fed maintain its current outlook on rate cuts. On the other hand, if jobs miss forecasts, there might be more pressure to cut rates, leading to an increase in rate cut expectations. Meanwhile, ECB’s Yannis Stournaras called for 100 bps in interest cuts this year in the Eurozone. This would translate to four rate cuts, putting the ECB in a more dovish position than the Fed. Moreover, he noted that the ECB did not have to wait for the Fed to start cutting rates. A more dovish ECB would lead to a decline in EUR/USD. Still, markets expect the Fed and the ECB to start cutting interest rates in June. EUR/USD key events today US ISM Manufacturing PMI EUR/USD technical forecast: Price finds respite, halts decline at 1.0775 support On the technical side, the EUR/USD decline has paused at the 1.0775 support level. The price sits below the 30-SMA, making the bias bearish. At the same time, the RSI trades in bearish territory below 50. The price has been in a downtrend since it found solid resistance at the 1.0950 key level. Moreover, it has traded in a bearish channel. –Are you interested to learn more about forex bonuses? Check our detailed guide- However, bears have grown weaker despite making lower lows. The RSI has made a bullish divergence that could soon lead to a reversal. Bulls will take over when the price breaks above the 30-SMA. https://www.forexcrunch.com/blog/2024/04/01/eur-usd-forecast-dollar-loses-ground-as-us-core-pce-falls/

2024-04-01 10:10

Japanese authorities got concerned when the yen hit a 34-year low on Wednesday. Suzuki repeated his warning that they would respond to any excessive currency moves. The dollar was on the back foot on Monday as Fed rate-cut bets increased. The USD/JPY outlook is slightly bearish as the yen showcases a modest recovery amid the persistent drumbeat of Japanese warnings to curb currency depreciation. At the same time, the yen found some relief as the dollar lost ground due to an increase in Fed rate-cut bets. –Are you interested to learn more about low spread forex brokers? Check our detailed guide- Investors have been cautious while trading USD/JPY, fearing a possible intervention since last week. Japanese authorities got concerned when the yen hit a 34-year low on Wednesday. As a result, they made it clear that they would take the necessary measures to curb further yen declines. The most recent intervention happened in 2022, when the pair hit the $152 mark, leading to a decline in USD/JPY. Notably, the currency pulled back on Monday when Finance Minister Shunichi Suzuki repeated his warning that they would respond to any excessive currency moves. Meanwhile, the dollar was on the back foot on Monday as Fed rate-cut bets increased after Friday’s inflation report. The core PCE price index revealed a drop in inflation from 0.5% to 0.3%. Powell noted that the reading supported their view that inflation was on a downtrend. Consequently, traders increased the likelihood that the central bank will cut interest rates in June to 68.5%. The next major report is this month’s nonfarm payrolls. USD/JPY key events today US ISM Manufacturing PMI USD/JPY technical outlook: Bears fight for control below the 30-SMA On the charts, the USD/JPY price is trading in a tight range, slightly below the 30-SMA. Meanwhile, the RSI is consolidating slightly above the pivotal 50 level. This is a sign that bears and bulls are fighting for control at this level. This comes after the previous bullish trend paused at the 152.00 resistance level. –Are you interested to learn more about forex bonuses? Check our detailed guide- Notably, the pause revealed weakness in bulls, as they could no longer make big swings above the SMA. At the same time, the RSI made a bearish divergence, highlighting the fading bullish momentum. Moreover, the price made a bearish, engulfing candle. Consequently, there is a bigger chance that bears will win the current battle. If this happens, the price will likely fall to retest the 150.00 key level and 0.382 Fib retracement level. https://www.forexcrunch.com/blog/2024/04/01/usd-jpy-outlook-yen-edges-up-as-japans-warnings-echo/

2024-03-28 10:22

Fed’s Waller said the recent inflation readings support a delay in rate cuts. The likelihood of a Fed rate cut in June has fallen to 60%. BoE’s Jonathan Haskel warned against expecting early rate cuts. The GBP/USD outlook is bearish as the dollar gains strength amidst fading expectations of a Fed rate cut. Moreover, market participants are gearing up for more economic data from the US that might give clues on Fed rate cuts. -Are you interested in learning about the best AI trading forex brokers? Click here for details- The dollar strengthened after Fed Governor Christopher Waller said the recent inflation readings support a delay in Fed rate cuts. Notably, some policymakers have lost confidence in the progress of inflation after the last report beat forecasts. As a result, investors are also doubting whether the Fed will be able to implement three rate cuts. The likelihood of a rate cut in June has fallen to 60%, boosting the dollar. However, this figure could change as more data comes in. The US will release data on GDP and jobless claims. However, the focus is on Friday’s core PCE report, which will show the state of inflation. Another higher-than-expected inflation figure could further strengthen the dollar, as it would diminish rate-cut expectations. Moreover, markets might price in less than three cuts in 2024. Meanwhile, the Bank of England has assumed a more dovish stance. However, some policymakers still believe rate cuts are a long way off. BoE’s Jonathan Haskel warned against expecting early rate cuts. According to him, although headline inflation has dropped, the BoE is focused on persistent and underlying inflation, which remains high. Therefore, June might be too early for the central bank to start easing its monetary policy. Markets currently expect the first cut to be in June or August. GBP/USD key events today US final quarter-on-quarter GDP US initial jobless claims US pending home sales US consumer sentiment GBP/USD technical outlook: Price dips following 1.2650 resistance On the charts, the GBP/USD price is declining after retesting and respecting the 1.2650 key resistance level. The bearish bias is strong as the price has established its downtrend with lower highs and lows. At the same time, it is now respecting the 30-SMA as resistance and might soon swing well below the line. -Are you interested in learning about the forex indicators? Click here for details- Meanwhile, the RSI is in bearish territory, below 50. Therefore, bears might soon make another lower low. The next immediate target for the downtrend is at the 1.2550 support level. The decline will continue below this level if the price stays below the SMA. https://www.forexcrunch.com/blog/2024/03/28/gbp-usd-outlook-fed-rate-cut-expectations-decline/

2024-03-28 09:27

The gold price bias is bullish, despite the last retreat. The US data should bring high action today. The upper median line (uml) is seen as a potential target. The gold price is trading in the green at $2,195 at the time of writing, with a fresh top in sight. XAU/USD extended its growth even though the US dollar jumped higher. -Are you interested in learning about the best AI trading forex brokers? Click here for details- Today, the fundamentals should move the prices, so uncertainty remains prevalent. The US Final GDP is expected to report a 3.2% growth again, and Claims could jump from 210K to 212K in the previous week. Pending Home Sales may report 1.4% growth after a 4.9% drop in the previous reporting period, while Revised UoM Consumer Sentiment is expected at 76.5 in March. Furthermore, the Chicago PMI could jump from 44.0 points to 45.9 points, which could be good for the greenback, while the Final GDP Price Index may announce a 1.6% growth. Positive US data should help the USD appreciate versus all its rivals. This scenario could punish the price of gold. Tomorrow, the Japanese and US data should move the prices. From a technical point of view, the XAU/USD came back higher after ending its temporary correction. After the previous rally, the prices retraced some gains. -Are you interested in learning about the forex indicators? Click here for details- The precious metal dropped within a down-channel pattern, which represented a bullish continuation formation. The XAU/USD rallied again after escaping from this pattern. It has retested the median line (ml), confirming this line as a dynamic support. As long as it stays above it, the bias is bullish. The upside pressure is high, so the price could try to approach the weekly R1 (2,210) and the upper median line. https://www.forexcrunch.com/blog/2024/03/28/gold-price-retains-momentum-near-2200-ahead-of-us-gdp/