What happened across the Asia session?
Most major currencies traded lower against the DXY during the Asia session.
What does it mean for Europe and US Sessions?
Look out for further DXY strength which would lead the major currencies to trade lower, losing further ground against the DXY.
The Dollar Index (DXY)
Key news events today
No major news events.
What can we expect from DXY today?
On Friday, the Core PCE price index was released at 0.6% (Forecast: 0.4%). This signaled that inflation growth in the US was higher than expected which is likely to spur further interest rate increases from the US Federal Reserve. Following the news release, the DXY climbed steadily from the 104.65 price level up toward the 105.30 price area. Currently consolidating at the 105 price level, look for the price to retrace briefly before trading higher toward the near term resistance of 105.50.
Central Bank Notes:
- Federal Reserve hiked rates by 25bps taking interest rates to 4.75%
- Next meeting is on 23 March 2023
- Ongoing rate increases will be expected
Next 24 Hours Bias
Weak Bullish
Gold (XAU)
Key news events today
No major news events.
What can we expect from Gold today?
Gold traded down to the support level of 1810 on Friday as the DXY strengthened. Although the price retraced slightly to retest the 1815 price area, look for further downside on Gold, especially if the price breaks below the 1810 price level, with the next key support level at the round number price level of 1800.
Next 24 Hours Bias
Medium Bearish
The Euro (EUR)
Key news events today
No major news events.
What can we expect from EUR today?
The EURUSD traded down to the 1.0540 price level on Friday as the DXY strengthened due to the release of better-than-expected Core PCE price index data. Early in the trading session today, the EURUSD retraced briefly to test the 1.0560 price level but current price action indicates a high likelihood of a continuation to the downside. Look for the EURUSD to break below the 1.0540 price level to signal further downside potential, with the next key support level at 1.0250.
Central Bank Notes:
- Main Refinancing Rate is currently at 3.00%
- Another 50bps rate hike is to be expected for the next meeting.
- Next meeting on 16 March 2023
Next 24 Hours Bias
Medium Bearish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
The USDCHF trades along the 0.94 round number resistance level following the strong move higher overnight. The move higher on the USDCHF was driven primarily by the strength of the DXY. Anticipating a continuation of the uptrend, look for the USDCHF to break above the 0.94 resistance level to signal further upside potential, with the next key resistance level at 0.9580.
Central Bank Notes:
- Current policy rate is at 1.00%
- Next meeting on 23 March 2023
Next 24 Hours Bias
Weak Bearish
The Pound (GBP)
Key news events today
No major news events.
What can we expect from GBP today?
The downward pressure persists for the GBPUSD as the price broke through the key support and round number level of 1.20 to reach the 1.1935 price area. Although the GBPUSD has retraced briefly, expect further downside on the GBPUSD, especially if the DXY continues to strengthen. Look for the GBPUSD to break through the 1.19 price level to signal a confirmation of the downside, with the next key support level at 1.16.
Central Bank Notes:
- Interest rate is currently at 4.00%
- The BoE could pause on further interest rate hikes.
- Next meeting on 23 March 2023
Next 24 Hours Bias
Weak Bearish
The Canadian Dollar (CAD)
Key news events today
No major news events.
What can we expect from CAD today?
The USDCAD traded steadily higher to reach the 1.3666 price level on Friday as the DXY strengthened. However, the currency pair retraced more than the other majors as the price retested the 1.36 round number support level. Look for the price to bounce off the round number level to signal a continuation of the uptrend. If the USDCAD breaks above the 1.3710 price level, further upside could be anticipated, with the next key resistance level at 1.39.
Central Bank Notes:
- Increased interest rates to 4.50%
- Indicated that the BoC was likely to pause on future rate hikes.
- Next meeting on 8 March 2023
Next 24 Hours Bias
Weak Bearish
Oil
Key news events today
No Major News Events
What can we expect from Oil today?
Energy prices traded with significant volatility on Friday as prices traded strongly lower before retracing sharply again. WTI currently trades at the 76.50 price level after testing the 74 round number level. Further upside could be anticipated, with the WTI likely to test the resistance level of 77.50. Similarly, Brent trades below the 83.00 level as cuts to Russian production levels drives prices higher. Look for Brent to continue trading higher to test the 84.00 round number resistance level.
Next 24 Hours Bias
Weak Bullish
