2024-03-04 08:24

BoJ’s Ueda said it is too early to say Japan’s inflation will soon reach the 2% target. Markets remain uncertain about the outcome of the March 19 BoJ policy meeting. The dollar was range-bound after it fell on Friday due to poor economic data. The USD/JPY forecast is slightly bullish on Monday amid the dovish comments of the top BoJ official last Friday. Meanwhile, weak manufacturing data made the dollar drift sideways after a bearish close on Friday. Bank of Japan governor Kazuo Ueda made remarks on Friday that dampened hopes for a rate hike in March. He said it is too early to say Japan’s inflation will soon reach the 2% target. Therefore, the central bank will likely need more time to assess the state of inflation before reversing its monetary policy. The most significant indicator of inflation trends in Japan is wage growth. The central bank needs evidence that wages are rising before considering hiking interest rates. As a result, markets remain uncertain about the outcome of the March 19 policy meeting. On the other hand, the dollar was mostly range-bound after it fell on Friday due to poor economic data. A report revealed that US manufacturing contracted in February, indicating a slowdown in the economy. This pushed up rate-cut bets, which was also a sign that high interest rates were slowing the economy. Therefore, the Fed might be more open to cutting rates in June. USD/JPY key events today There are no high-impact economic releases on the USD/JPY calendar today. Therefore, the pair might drift sideways. USD/JPY technical forecast: Consolidating below critical 150.86 level On the technical side, the USD/JPY pair remains range-bound below the 150.86 key resistance level. At some point, the price attempted to break below the range support. However, it closed inside the range, making a big wick. This is a sign that bulls are not ready to give up control. Still, the bullish momentum has weakened. Notably, the price is chopping through the SMA and the RSI through the 50 mark. This shows a ranging market. Moreover, the RSI has made a bearish divergence, indicating weaker bullish momentum. If the divergence plays out, the price will collapse to retrace the previous bullish move. On the other hand, if bulls regain momentum, the price could break above 150.86. https://www.forexcrunch.com/blog/2024/03/04/usd-jpy-forecast-yen-retreats-following-uedas-remarks/

2024-03-02 12:24

The annual US PCE figure indicated a gradual decline in inflation. Fed rate-cut bets for June rose above 65%. Inflation data in countries like Germany, France, and Spain eased in January. The EUR/USD weekly forecast leans slightly bearish as Eurozone inflation takes a dip, exerting pressure on the ECB to consider interest rate cuts. Ups and downs of EUR/USD EUR/USD had a slightly bearish week amid inflation data from the US and the Eurozone. It was a mostly calm week, with few high-impact reports on the calendar. Notably, the US personal consumption expenditures report revealed a mixed picture of inflation in the US. While the monthly figure rose, the annual figure indicated a gradual decline in inflation. Consequently, rate-cut bets for June rose above 65%. Meanwhile, inflation in countries like Germany, France, and Spain eased in January, increasing pressure on the ECB to cut interest rates. Moreover, estimates for Eurozone inflation revealed a decline that saw the pair fall. Next week’s key events for EUR/USD Next week, traders will analyze employment figures from the US for clues on the timing of Fed interest rate cuts. In January, the country recorded 353K jobs, an impressive surge from the previous month. Moreover, it was well above estimates, leading to a decline in the pair and a drop in rate-cut expectations. The labor market and the economy at large have continued to show resilience despite higher interest rates. As a result, Fed speakers have pushed back expectations of Fed interest rate cuts. Markets now believe the first cut will come in June. Therefore, a higher-than-expected reading on employment could lead to further delays in interest rate cuts. On the other hand, a decrease would increase bets for a cut in June. EUR/USD weekly technical forecast: Bulls eyeing opportunity above 22-SMA On the technical side, EUR/USD has gone above the 22-SMA, a sign that bulls might be ready to take over. The previous decline paused at a solid support zone comprising the 1.0700 key psychological level and the 0.618 Fib retracement level. The bullish move paused to retest the recently broken SMA before likely continuing higher. If the SMA holds firm as support, the price will get a chance to retest the 1.1100 resistance level. However, if bears are still strong, the price might break below the SMA and the 1.0700 support level. This would allow the price to target the 1.0501 support level. https://www.forexcrunch.com/blog/2024/03/02/eur-usd-weekly-forecast-ecb-to-cut-rates-as-inflation-cools/

2024-03-02 09:18

There was a bigger-than-expected build in crude inventories last week. GDP data from Canada showed a bigger-than-expected expansion in the fourth quarter. Market participants will watch the outcome of the Bank of Canada interest rate decision. The USD/CAD weekly forecast leans bullish as the dollar regains strength just in time for the highly anticipated nonfarm employment report. Ups and downs of USD/CAD USD/CAD ended the week on a bullish note as the dollar surged against the Canadian dollar. The biggest move of the week came on Wednesday as oil prices fell. Notably, there was a bigger-than-expected build in crude inventories last week, leading to a decline in oil prices. As a result, the Canadian dollar weakened against the dollar. Other data in the week included the US PCE price index, which revealed easing annual inflation. Additionally, GDP data from Canada showed a bigger-than-expected economic expansion in the fourth quarter. Next week’s key events for USD/CAD Next week, traders will focus on employment data from Canada and the US. These reports will have a significant impact on the outlook for monetary policy in the US and Canada. Moreover, market participants will watch the outcome of the Bank of Canada’s interest rate decision. Employment figures from the US and Canada came in higher than expected last month, indicating the labor market in both countries remains hot. Consequently, this has kept central banks in both countries cautious about rate cuts. At the moment, markets expect the first Bank of Canada rate cut in June. Similarly, they expect the Fed to start cutting rates in June. However, this might change with the employment figures. USD/CAD weekly technical forecast: Bulls fading as the price approaches 1.3600 resistance On the daily chart, sentiment shifted suddenly from bearish to bullish when the price found support at 1.3200 and broke above the 22-SMA. However, soon after, the bullish momentum weakened, and the move became shallow. Moreover, the price kept puncturing the 22-SMA support line. The price has traded in a bullish channel that has now paused at the 1.3600 key resistance level. Meanwhile, the RSI trades above 50, supporting bullish momentum. If bulls regain their previous enthusiasm, the price might break above the 1.3600 resistance level. However, if bears get strong enough to break below the channel support, the price might fall back to retest the 1.3200 support level. https://www.forexcrunch.com/blog/2024/03/02/usd-cad-weekly-forecast-dollar-resilient-ahead-of-us-nfp/

2024-03-01 10:32

Inflation in Germany, the largest Eurozone economy, rose by a slower 2.7% on an annual basis. Economists believe underlying Eurozone inflation remains stubborn. Bets for a Fed rate cut in June rose to 66%. Friday’s EUR/USD price analysis revealed a bearish sentiment, driven by the emerging signals of inflation easing in the Eurozone. The prospect of a decline in inflation could prompt the European Central Bank to consider starting interest rate cuts. Meanwhile, inflation in the US also showed signs of easing on an annual basis. –Are you interested to learn more about automated forex trading? Check our detailed guide- Inflation in Germany, the largest Eurozone economy, rose by a slower 2.7% on an annual basis in January. This was in line with economists’ expectations and indicated that inflation in the larger bloc might show a decline. However, economists believe underlying inflation remains stubborn. Notably, the decline in German inflation came from cheaper energy prices. However, figures excluding food and energy prices revealed a much slower decline in inflation. It is for this reason that the ECB has pushed back expectations for rate cuts. On the other hand, the dollar was steady after the US PCE price index report showed an increase in price growth in January. Still, the annual figure showed a gradual easing in inflation. As a result, bets on a Fed rate cut in June rose to 66%. Another report revealed that jobless claims in the US rose last week, indicating softness in the labor market. Additionally, continuing claims have risen in the past month, which could indicate an increase in unemployment rates. Traders will now await the nonfarm payroll report next week for guidance on the Fed’s rate cut timing. EUR/USD key events today US ISM manufacturing PMI US consumer sentiment EUR/USD technical price analysis: Consolidating within the 1.0800-1.0850 range On the charts, EUR/USD is consolidating, with support at 1.0800 and resistance at 1.0850. However, within this range area, bears are in control as the price sits below the 30-SMA with the RSI below 50. –Are you interested to learn more about forex signals? Check our detailed guide- The previous bullish move paused at the 1.0850 resistance level, where price action indicated a looming reversal. The bulls tried on several occasions to break above the resistance but failed, making large wicks. Meanwhile, the bears got stronger and broke below the 30-SMA. Therefore, the price might soon break below 1.0800 to retest the 1.0700 support level. https://www.forexcrunch.com/blog/2024/03/01/eur-usd-price-analysis-euro-slides-on-easing-german-inflation/

2024-03-01 09:39

A new higher high activates further growth. Taking out 2,041 signals a deeper drop. The US data could change the sentiment. The gold price marked a fresh multi-day top at $2,050 yesterday amid a weaker US dollar. Now, the metal has retreated a little and is trading at $2,045 at the time of writing. –Are you interested to learn more about automated forex trading? Check our detailed guide- The bias remains bullish despite the corrective downside. After yesterday’s strong rally, the price is retracing amid profit-taking. The US Unemployment Claims came in at 215K above 209K expected, the Core PCE Price Index rose by 0.4% as expected, Personal Income reported a 0.1% growth, versus the 0.4% growth estimated, while Personal Spending came in line with expectations. Furthermore, the Chicago PMI and Pending Home Sales came in worse than expected. Still, the greenback rallied despite mixed economic figures. XAU/USD’s rally was somehow expected after some poor figures. Today, Chinese Manufacturing PMI came in at 49.1 points as expected, Non-Manufacturing PMI jumped from 50.7 points to 51.4 points, above 50.9 points forecasted, while Caixin Manufacturing PMI was reported at 50.9 points, above 50.7 estimates. Later, the Eurozone CPI Flash Estimate and Core CPI Flash Estimate should have an impact as well. However, only the US economic data could change the sentiment. The ISM Manufacturing PMI and the Revised UoM Consumer Sentiment represent high-impact events. In addition, the ISM Manufacturing Price, Construction Spending, Revised UoM Inflation Expectations, and Wards Total Vehicle Sales data will be released as well. Technically, XAU/USD found resistance right below the R1 of $2,051. It has printed only false breakouts through the median line (ml) and now it has turned to the downside after retesting the dynamic resistance. –Are you interested to learn more about forex signals? Check our detailed guide- The first downside target and obstacle is represented by the $2,041 level. The retreat is natural after the last bullish momentum. The price could try to confirm the breakouts from the range movement. Dropping and closing below $2,041 may result in more declines. An upside continuation should be confirmed by a new higher high if the price jumps and closes above the median line (ml) and the R1 (2,051). https://www.forexcrunch.com/blog/2024/03/01/gold-price-rally-stalls-by-2050-focus-on-us-data/

2024-03-01 09:24

Canada’s economy expanded at an annual rate of 1.0% in the fourth quarter. The Bank of Canada will likely pause rates next week. US inflation data came in line with expectations. Friday’s USD/CAD outlook took a mildly bearish turn, influenced by the Canadian dollar’s strength following encouraging economic data from Canada. Particularly noteworthy was Canada’s economic expansion of 1.0% in the fourth quarter, which beat forecasts. As a result, there was a decline in rate cut expectations. –Are you interested to learn more about automated forex trading? Check our detailed guide- The Bank of Canada had expected zero growth while economists had forecast 0.8% growth in Q4. Unlike Japan and the UK which slipped into a recession at the end of 2023, Canada’s economy is slowly expanding. Therefore, there is little pressure on the Bank of Canada to cut interest rates. Investors are eagerly awaiting the next BoC policy meeting next week, to get insight into the outlook for interest rates in Canada. The central bank will likely pause rates as they have done for the last few meetings. However, high interest rates have gradually slowed both inflation and growth. Therefore, pressure has been mounting on the central bank to cut interest rates. Markets currently place an 80% chance of a rate cut in June. Inflation in Canada has gradually fallen from a high of 8.1% to 2.9%. However, policymakers are still not convinced that it is under control. Meanwhile, the dollar was weaker a day after inflation data came in line with expectations. The PCE price index showed an increase in the monthly figure. However, a decline in the annual figure reinforced expectations of a Fed rate cut in June. USD/CAD key events today US ISM manufacturing PMI US consumer sentiment USD/CAD technical outlook: Price takes a breather at 1.3575 resistance On the technical side, the USD/CAD price has paused near the 1.3575 key resistance level. The pause comes after a bullish move starting at the 1.3450 support level that pushed above the 30-SMA resistance line. Therefore, the bias is bullish. Moreover, the RSI sits above 50, showing solid bullish momentum. –Are you interested to learn more about forex signals? Check our detailed guide- Consequently, bulls might be waiting at the nearest support level to resume the uptrend. At the moment, the nearest support is at the 30-SMA. Therefore, the price might consolidate or fall, as the SMA catches up. When it does, bulls might reemerge to push the price to the 1.3625 key level. https://www.forexcrunch.com/blog/2024/03/01/usd-cad-outlook-canadian-dollar-edges-higher-on-upbeat-data/