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/

2024-02-29 12:23

The bias is bearish as long as it stays below the upper median line. The US economic data should bring strong action. Escaping from the up channel signaled a new leg down. The EUR/USD price is trading at 1.0838 at the time of writing. The pair looks positive to approach new highs as the US dollar remains weak. –Are you interested to learn more about automated forex trading? Check our detailed guide- The greenback depreciated as expected because the US Prelim GDP and Goods Trade Balance came downbeat in the last trading session. Today, the German Retail Sales reported a 0.4% drop, even though the traders expected a 0.5% growth, while the German Unemployment Change came in better than expected, at 11K above 6K estimated. The German Prelim CPI should be released today as well. Later, the US economic figures should have a big impact. The Core PCE Price Index may announce a 0.4% growth after the 0.2% growth expected. Unemployment Claims could jump from 201K to 209K, Chicago PMI could be reported at 48.1 points, above 46.0 points in the previous reporting period, while Pending Home Sales could announce a 1.4% growth in January after an 8.3% growth in December. In addition, Personal Spending and Personal Income data will be published as well. From a technical point of view, the EUR/USD price rose after the last strong sell-off. In the short term, a minor rebound was natural. The price has climbed as much as 1.0854, where it has found a strong supply. As you can see on the hourly chart, the price escaped from the up channel pattern, indicating a new leg down. –Are you interested to learn more about forex signals? Check our detailed guide- It has retested the supply zone below 1.0860 and under the descending pitchfork’s upper median line (uml). The pair could drop again if it stays below the upper median line (uml). Taking out this dynamic resistance confirms further growth. https://www.forexcrunch.com/blog/2024/02/29/eur-usd-price-wobbling-near-resistance-all-eyes-on-core-pce/

2024-02-29 10:28

Australia’s retail sales recovered at the start of 2024 after falling in December. Australia’s annual sales growth remained low due to high interest rates. Markets were gearing up for another US inflation report on Thursday. The AUD/USD outlook showcased a neutral outlook as the Australian dollar danced after the unveiling of mixed economic data. Meanwhile, investors were cautious ahead of fresh inflation data from the US that will guide the outlook for interest rates. –Are you interested to learn more about automated forex trading? Check our detailed guide- Data on Thursday revealed that Australia’s retail sales recovered at the start of 2024 after falling in December. However, the increase of 1.1% missed forecasts of a 1.5% increase. Moreover, sales growth annually remained low due to high interest rates. Meanwhile, another report indicated a 0.8% increase in business investment in Q4. This increase came due to growth in the mining sector, which is positive for the economy. The RBA is still unconvinced that its fight to tame inflation is over. As a result, policymakers said at the last meeting that there was a chance the central bank would hike interest rates. However, after Tuesday’s inflation report, traders are more convinced that the RBA’s rate hike cycle is over. Notably, Australia’s inflation held at a two-year low in January. Meanwhile, markets were gearing up for another US inflation report on Thursday. The core PCE price index is a significant report as the Fed uses it as the best measure for inflation in the country. Therefore, it carries a lot of weight and will likely impact the outlook for interest rate cuts in the US. AUD/USD key events today US core PCE price index US initial jobless claims AUD/USD technical outlook: Price halts at 0.618 Fib and 0.6500 psychological barrier On the technical side, AUD/USD has paused at the 0.618 Fib level, which also lies at the 0.6500 key psychological level. Meanwhile, the bias is bearish as the price trades well below the 30-SMA with the RSI under 50, supporting bearish momentum. –Are you interested to learn more about forex signals? Check our detailed guide- Although bears tried to break below this strong support zone, the price pulled back above. This is a sign that it was rejected below the support zone. However, the bearish bias is strong. Therefore, even if the price consolidates at this support, it might eventually break below. A break below would allow bears to retest the 0.6450 support level. https://www.forexcrunch.com/blog/2024/02/29/aud-usd-outlook-aussie-neutral-amid-mixed-economic-signals/

2024-02-29 08:50

Hajime Takata said there were signs the BoJ would soon achieve its 2% inflation target. The yen remains among the worst-performing G10 currencies against the dollar this month. Markets awaited the US’s core PCE price index report. In Thursday’s USD/JPY forecast, a bearish outlook prevailed as the yen surged following hawkish statements from the Bank of Japan. A BoJ policymaker emphasized the need to conclude the central bank’s ultra-easy monetary policy. –Are you interested to learn more about automated forex trading? Check our detailed guide- Notably, Bank of Japan board member Hajime Takata said there were signs that the central banks would soon achieve its 2% inflation target. As a result, the bank can finally start hiking interest rates. Analysts say the BoJ could surprise markets with a rate hike in March. Still, the yen remains among the worst-performing G10 currencies against the dollar this month. In February, the dollar rallied as upbeat economic data led to a decline in rate-cut bets. Meanwhile, the yen weakened as policymakers dampened expectations for aggressive rate hikes from the BoJ. On Wednesday, the dollar held steady as markets awaited the US’s core PCE price index report. This report will guide the Fed on the next policy moves to tame inflation. Notably, economists expect an increase of 0.4%. Currently, expectations for a rate cut in May have fallen to 20%, while those for June are near 50%. A higher-than-expected reading on today’s inflation report could lead to a further decline in rate cut expectations. Consequently, the dollar would rally, putting pressure on the yen. USD/JPY key events today US core PCE price index m/m US unemployment claims USD/JPY technical forecast: 150.86 Resistance Sparks Bearish Divergence The price has made a bearish divergence on the charts after finding solid resistance at the 150.86 level. Initially, the price traded in a strong bullish trend that paused at the 150.86 resistance level. After pausing, it moved sideways in a rectangle with clear support and resistance. –Are you interested to learn more about forex signals? Check our detailed guide- However, the bearish divergence in the RSI showed that bullish momentum was fading. As a result, there was a strong break below the 30-SMA, indicating a shift in sentiment. At the same time, the RSI is nearing the oversold region, supporting strong bearish momentum. If the price breaks out of its rectangle, the first target will be at the 0.382 Fib level. Meanwhile, the second target will be at the 0.618 Fib level. https://www.forexcrunch.com/blog/2024/02/29/usd-jpy-forecast-yen-surges-on-hawkish-boj-remarks/

2024-02-28 13:28

A new lower low activates a deeper drop. The US data could bring some action. Escaping from the up channel signaled a new leg down. The gold price turned down and is trading at $2027 at the time of writing. The US dollar’s rally weighed down the precious metal. The yellow metal dropped even though the US reported poor economic data. –Are you interested to learn more about automated forex trading? Check our detailed guide- The Durable Goods Orders, Core Durable Goods Orders, Richmond Manufacturing Index, and CB Consumer Confidence were worse than expected in the last session. Also, today, the Australian Consumer Price Index reported a 3.4% growth, even though analysts had expected a 3.6% growth. In addition, the RBNZ left the Official Cash Rate at 5.50%, as expected. Later, the United States’ economic figures should shake the markets. The Prelim GDP is expected to report a 3.3% growth, the Prelim GDP Price Index may reveal a 1.5% growth, the Goods Trade Balance could drop to -88.4B, while Prelim Wholesale Inventories should result in a 0.1% growth. Positive economic data can help the greenback appreciate and may push the XAU/USD toward new lows. Only poor data should help gold to hit new highs. XAU/USD climbed as high as $2041, where it found resistance. It has escaped from the up channel pattern (flag formation), signaling a new leg down. –Are you interested to learn more about forex signals? Check our detailed guide- The price could come back down to test the support levels, trying to accumulate new bullish energy before jumping higher. The weekly pivot point of $2025 paused the sell-off, and now it is trying to rebound and recover. The false breakdown announced exhausted sellers. So, only a new lower low could activate a significant downside movement. https://www.forexcrunch.com/blog/2024/02/28/gold-price-turns-bearish-ahead-of-us-gdp-support-at-2025/

2024-02-28 10:03

Investors were positioning themselves ahead of the core PCE price index. Consumer confidence in the US fell amid fears about the economy’s outlook. Economists expect the core PCE price index to increase by 0.4%. Wednesday’s GBP/USD forecast unveils a bearish outlook, spurred by the dollar’s surge in anticipation of key inflation data. Investors positioned themselves ahead of the core PCE price index, which the Fed closely monitors. On Tuesday, the dollar had pulled back slightly after the US released poor economic data. –Are you interested to learn more about automated forex trading? Check our detailed guide- Notably, consumer confidence in the US fell amid fears about the economy’s outlook. Consumers were concerned about the looming presidential election that could impact the economy. Additionally, another report revealed a decline in orders for core durable goods. Business investment in equipment softened in January. However, investors brushed this weakness aside on Wednesday as they awaited inflation data. Recent figures on US inflation have come in higher than expected, showing persistence. Therefore, there is a high chance this trend will continue. If it does, the core PCE figure might be higher than the expected 0.4%. Consequently, investors would scale back expectations for June’s first Fed rate cut. As a result, the dollar would climb, leading to a decline in GBP/USD. Meanwhile, according to figures from the US Commodity Futures Trading Commission, speculators have reduced their bullish positions in the pound as they await new catalysts in the market. At the same time, volatility has dropped significantly in the pound in recent weeks. However, the currency has mostly held steady. GBP/USD key events today Preliminary US GDP GBP/USD technical forecast: Price takes a dip after hitting its channel ceiling On the charts, GBP/USD bounces lower after hitting a resistance zone comprising its channel resistance and the 1.2700 critical level. The price is currently trading in a bullish channel. However, after touching the channel resistance, bears have taken over with a break below the 30-SMA. –Are you interested to learn more about forex signals? Check our detailed guide- Notably, it made a solid bearish impulse leg before the price started trading in the channel. Therefore, there is a chance that the same will happen when it breaks out of its shallow channel. Currently, price action shows strong bearish momentum. Moreover, the RSI supports bearish momentum below 50. Consequently, the decline might continue past channel support to retest the 1.2500 key support level. https://www.forexcrunch.com/blog/2024/02/28/gbp-usd-forecast-sellers-emerge-ahead-of-us-core-pce-data/