2024-01-26 09:26
Traders increased expectations of an ECB rate cut in April. The dollar remained stable on Friday as traders assessed the impact of unexpectedly strong economic growth data. The dollar has seen a 2% increase this year due to declining Fed rate cut expectations. On Friday, the EUR/USD outlook was bearish as traders increased their bets for an April rate cut, spurred by the ECB’s monetary policy meeting on Thursday. Despite maintaining interest rates at a record high of 4%, the ECB hinted at forthcoming discussions about rate cuts. –Are you interested to learn more about forex options trading? Check our detailed guide- Policymakers, speaking after the meeting, indicated openness to a shift in stance at the next meeting. This paves the way for an early interest rate cut if upcoming data confirms inflation has eased. At the same time, traders have raised bets on a rate cut in April due to the recent remarks by policymakers. The ECB’s stance has boosted rate cut expectations. Moreover, it supports a bearish outlook for the euro. On the other hand, the US dollar remained stable on Friday. Traders assessed the impact of unexpectedly strong economic growth data on the Fed’s rate trajectory. Additionally, they expect a key inflation gauge for further insights. Official data on the advance GDP estimate revealed a 3.3% annual growth rate in the last quarter, beating the forecast of 2%. Furthermore, the report indicated a further easing of inflation pressures. The dollar has seen a 2% increase year-to-date, reflecting a decrease in rate cut expectations compared to the end of last year. According to the CME FedWatch tool, there is a 50% probability of a rate cut in March, down from 75.6% one month ago. EUR/USD key events today US Core PCE Price Index m/m EUR/USD technical outlook: Bears break free from consolidation On the technical side, EUR/USD has broken out of its consolidation area, retested the range support as resistance, and is now continuing its decline. The bearish bias has strengthened as the price has swung far below the 30-SMA. At the same time, the RSI has dipped further into bearish territory, nearing the oversold region. -If you are interested in knowing about scalping forex brokers, then read our guidelines to get started- Bears are currently targeting the nearest support at 1.0800. This level might trigger a pause or pullback to retest the 30-SMA before the downtrend continues. However, the price might breach 1.0800 without pausing if bears are strong enough. https://www.forexcrunch.com/blog/2024/01/26/eur-usd-outlook-traders-bet-on-ecb-rate-cut-in-april/
2024-01-25 11:22
The rebound could be only temporary. Coming back below the pivot point indicates more declines. The ECB and the US figures should move the rate today. The USD/JPY price turned upside after reaching yesterday’s low of 146.65. The pair has climbed as high as 147.87 today, failing to test the 148.00 psychological level. –Are you interested to learn more about forex options trading? Check our detailed guide- Yesterday, the greenback received a helping hand from the upbeat US economic data. The price recovered as the United States Flash Manufacturing PMI reached 50.3 points versus the expected 47.6 points, confirming expansion. Meanwhile, the Flash Services PMI jumped from 51.4 points to 52.9 points, announcing further expansion. Today, the European Central Bank should drive the markets. The Main Refinancing Rate should remain at 4.50%, but the Monetary Policy Statement and the ECB Press Conference could change the sentiment. Furthermore, the US will release key economic data, so the fundamentals could be decisive. The Advance GDP may announce a 2.0% growth, less compared to the 4.9% growth in the previous reporting period. Furthermore, the Unemployment Claims, Advance GDP Price Index, Durable Goods Orders, Core Durable Goods Orders, and New Home Sales data will also be released. Tomorrow, the Japanese Tokyo Core CPI, Monetary Policy Meeting Minutes, and the US Core PCE Price Index should move the price. Technically, the USD/JPY price failed to stay below the 147.00 psychological level. The pair has tried to retest the 148.00 psychological level and the median line (ml). After the last sell-off, the rebound is widely anticipated. -If you are interested in knowing about scalping forex brokers, then read our guidelines to get started- The rate could only retest the key level before going down again. Coming back and stabilizing below the weekly pivot point of 147.26 indicates more declines towards the S1 (145.73). https://www.forexcrunch.com/blog/2024/01/25/usd-jpy-price-exhausted-below-148-00-eyes-on-us-gdp/
2024-01-25 09:38
Investors eagerly awaited the US GDP report. The ECB will likely maintain steady rates. Markets currently indicate a 43% probability of a Fed cut in March, a notable decrease from 88% a month ago. Thursday’s EUR/USD outlook leaned modestly bullish, with the pair showcasing strength ahead of a pivotal European Central Bank policy meeting. Additionally, there was anticipation for the US GDP report, which might give clues on the potential direction of US interest rates. –Are you interested to learn more about forex options trading? Check our detailed guide- The ECB will likely maintain steady rates. However, investors will pay attention to the strength of officials’ resistance against expectations of rate cuts. Market participants expect 130 basis points of cuts from the ECB throughout the year. The ECB concluded its fastest rate-hiking cycle in September. However, policymakers have said that discussions about rate cuts are premature. Meanwhile, markets expect the Fed to maintain its current stance in the US next week. However, the focus will be on Chair Jerome Powell’s comments. Markets currently indicate a 43% probability of a cut in March, a notable decrease from 88% a month ago. At the same time, traders are pricing in 134 basis points of cuts this year, down from 160 bps at the close of 2023. The dollar has risen approximately 2% this month as traders significantly reduce expectations for early and substantial rate cuts from the Fed. This shift follows hawkish remarks from policymakers. Moreover, recent data has highlighted the resilience of the US economy. Notably, data on Wednesday revealed an uptick in business activity in the US, accompanied by a decrease in a measure of inflation. Prices companies charge for their products fell to the lowest level in over 3 1/2 years. EUR/USD key events today ECB monetary policy meeting US Gross Domestic Product US initial jobless claims EUR/USD technical outlook: Sideways near 1.0900 The pair is moving sideways on the charts, caught near the 1.0900 key level. The price is chopping through the 30-SMA, showing a ranging market. However, the larger scale shows that the trend is bearish as the price makes lower lows and highs. Moreover, the price is making consistent impulse and corrective moves. -If you are interested in knowing about scalping forex brokers, then read our guidelines to get started- At the moment, EUR/USD is in a corrective move. Given the bearish bias on the larger scale, the next move could be a bearish impulsive leg. Consequently, the price might soon drop to the 1.0800 support. https://www.forexcrunch.com/blog/2024/01/25/eur-usd-outlook-euro-recovers-as-ecb-policy-meeting-looms/
2024-01-25 08:07
The fourth-quarter US gross domestic product will likely reveal a 2% annualized growth. On Wednesday, the Bank of Canada maintained its key overnight rate at 5%. Money markets fully anticipate a 25 basis point BoC rate cut in June. Thursday’s USD/CAD forecast hinted at bullish prospects, with the dollar standing resilient near a six-week high. Investors eagerly awaited GDP and other critical data, seeking valuable insights that could give clues on the outlook for US interest rates. –Are you interested to learn more about forex options trading? Check our detailed guide- The initial report on the fourth-quarter US gross domestic product will likely reveal a 2% annualized growth. Moreover, the report might show that the US avoided a recession in 2023. Furthermore, it will likely indicate a slowdown in inflation during the last quarter. This could fuel expectations of potential rate cuts in the first half of 2024. Meanwhile, the Canadian dollar weakened after the Bank of Canada held its key overnight rate at 5% on Wednesday. Additionally, it emphasized a shift in focus from concerns about underlying inflation to considering when to cut rates. Canadian money markets expect a 25 basis point cut in June. The BoC removed language from previous policy statements on possible rate hikes. However, Governor Macklem later mentioned that the possibility of additional rate hikes had not been ruled out. Furthermore, the BoC adjusted its growth outlook, anticipating weak growth in the first quarter, followed by a gradual pickup. Inflation will likely stay around 3% in the first half of 2024, easing to 2.5% in the second half. Meanwhile, a return to the 2% target will likely happen sometime in 2025. USD/CAD key events today Advance US GDP q/q US unemployment claims USD/CAD technical forecast: Bulls make a comeback On the technical side, USD/CAD has retested the 1.3525 resistance level after the bearish takeover failed at the 1.3425 support level. At the moment, bulls are attempting to resume the previous bullish trend. They have pushed the price above the 30-SMA, and the RSI is above 50. -If you are interested in knowing about scalping forex brokers, then read our guidelines to get started- Initially, bears had attempted to take control when the price broke below the 30-SMA. However, they were not strong enough to continue below the 1.3425 support level, allowing bulls to regain control. Now, bulls are facing strong resistance. At the same time, the RSI is showing weaker bullish momentum at this resistance. If it holds, the price will fall back to the 1.3425 support. Meanwhile, the bullish trend will continue if bulls regain momentum. https://www.forexcrunch.com/blog/2024/01/25/usd-cad-forecast-dollar-holds-near-6-week-high-ahead-of-gdp/
2024-01-24 13:50
Taking out the median line activates further growth. The US manufacturing and services data should bring high action today. The BOC Press Conference could change the sentiment. The gold price is trading in the green at $2,033 at the time of writing. The metal seems determined to hit new highs as the US dollar lost momentum. In the short term, the XAU/USD stays sideways. Hence, we need to wait for a clear direction. -Are you interested in learning about the forex signals telegram group? Click here for details- Yesterday, the BOJ left its monetary policy unchanged, while the New Zealand Consumer Price Index rose by 0.5%, as expected. Today, the manufacturing and services data and the BOC should move the markets. The German and the Eurozone services and manufacturing sectors confirmed contraction again, while the United Kingdom Flash Services PMI announced further expansion after being reported at 53.8 points above 53.1 expected. Later, the US Flash Manufacturing PMI is expected to drop from 47.9 points to 47.6 points, conforming to further contraction, while the Flash Services PMI could remain at 51.4 points for the second month in January. Also, the Bank of Canada should keep the Overnight Rate at 5.00%. Still, the BOC Press Conference, BOC Rate Statement, and BOC Monetary Policy Report could change the sentiment. Tomorrow, the ECB and the US Advance GDP represent high-impact events. From the technical point of view, the XAU/USD seems undecided in the short term. The price action developed a symmetrical triangle, so only escaping from this pattern brings us new opportunities. The yellow metal has found demand above the $2,020. Now, it tries to approach new highs. I have drawn an ascending pitchfork, hoping to catch an upward movement. The price is trapped between the median and lower median lines (ml) lines (LML). A valid breakout through the triangle’s resistance and above the median line validates a larger growth and could be seen as a long opportunity. https://www.forexcrunch.com/blog/2024/01/24/gold-price-forms-triangle-eyes-on-us-pmi-data/
2024-01-24 11:27
British services firms experienced increased growth this month. Data revealed a smaller-than-anticipated budget deficit for December in Britain. Market indicators suggest approximately a 50% probability that the BoE will start rate cuts in May. Wednesday brought a bullish outlook to the GBP/USD forecast due to signs of resilience in the British economy. Moreover, there were expectations that the Bank of England would delay rate cuts compared to other central banks. –Are you interested to learn more about forex options trading? Check our detailed guide- British services firms experienced increased growth this month, indicating a modest recovery in the sluggish economy. However, factories are now feeling the impact of tensions in the Red Sea. The PMI data will likely reassure the Bank of England before the upcoming interest rate meeting, suggesting a reduction in overall inflation pressure. Nevertheless, it may support the argument for a cautious approach in gradually lowering borrowing costs. The preliminary S&P Global/CIPS UK Composite PMI rose to 52.5 in January, marking the highest level in seven months. Moreover, it was an improvement from December’s reading of 52.1. Meanwhile, on Tuesday, data revealed a smaller-than-anticipated budget deficit for December in Britain. Therefore, there is space for tax cuts in the upcoming March budget. Analysts at Monex Europe mentioned that sentiment toward the UK economy is “generally improving.” In the medium term, the key question for the British currency is whether the Bank of England will trail behind the Fed and the ECB in cutting rates and by what margin. Meanwhile, market indicators suggest approximately a 50% probability that the BoE will start rate cuts in May. However, this timeline might be too early for the bank, which has expressed concerns about persistent inflation. GBP/USD key events today US Flash Manufacturing PMI US Flash Services PMI GBP/USD technical forecast: Renewed bullish momentum targets 1.2800 The pound is continuing higher and is on the verge of breaking above the 1.2750 resistance level. The bullish bias is strong and has been since the price made a bullish engulfing candle at the 1.2600 support level. -If you are interested in knowing about scalping forex brokers, then read our guidelines to get started- Initially, the bullish move paused at the 1.2750 resistance level, allowing bears to attempt a takeover at the 30-SMA. However, they failed as bulls returned with renewed momentum. If the price closes above 1.2750, bulls will soon retest the 1.2800. Additionally, a break above 1.2800 would finally allow the pair to trend after a long time in consolidation. https://www.forexcrunch.com/blog/2024/01/24/gbp-usd-forecast-resilience-in-uk-economy-boosts-pound/
