What happened across the Asia session?
Most major currencies retraced briefly against the DXY during the Asia session.
What does it mean for Europe and US Sessions?
Look out for higher volatility in price in the US market, with the major currencies possibly reversing after completing the current retracement.
The Dollar Index (DXY)
Key news events today
USD FOMC Meeting Minutes
USD Prelim GDP q/q
What can we expect from DXY today?
The DXY climbed steadily higher overnight to reach the 104.50 price area before retracing again. The move higher was spurred on by the release of the FOMC meeting minutes which indicated that members backed the 25bps rate hike and some could have supported a 50bps hike decision. Currently trading at the 104.35 price level, look for the DXY to consolidate along the current level or retrace further briefly before trading higher again. If the DXY breaks above 104.55, the next key resistance level is at 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 fluctuated between 1832 and 1846 through most of the trading session yesterday. However, as the DXY strengthened, this led to Gold breaking below the consolidation to reach a near-term low of 1823. Look for the price to complete the current retracement and to trade lower again. If the price breaks below 1820, the next key support levels are at the round number level of 1800 and 1775.
Next 24 Hours Bias
Medium Bearish
The Euro (EUR)
Key news events today
No major news events.
What can we expect from EUR today?
Overnight, the EURUSD traded strongly lower to the 1.06 round number support level. However, as the price failed to sustain the downward move to break the support level, the EURUSD has rebounded and is currently trading at the 1.0625 price level. Look for the EURUSD to continue climbing to the upside, if the DXY weakens further, with the near term resistance level at 1.0660.
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
Weak Bullish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
The USDCHF climbed to a high of 0.9315 overnight before reversing strongly to trade along the 0.9292 price level early in the trading session today. If the DXY continues to trade lower, the USDCHF could follow with the downward pressure to trade down to the 0.9260 price level.
Central Bank Notes:
- Current policy rate is at 1.00%
- Next meeting on 23 March 2023
Next 24 Hours Bias
Weak Bullish
The Pound (GBP)
Key news events today
No major news events.
What can we expect from GBP today?
As the DXY strengthened overnight, the GBPUSD traded lower from the 1.2110 price level to end the trading session along the 1.2035 price level. Currently retracing higher at the 1.2070 price level, look for the GBPUSD to potentially retest 1.21 before trading lower again. This move lower would be dependent on the recovery of strength on the DXY. If the price reverses after the retracement, the GBPUSD could trade down to the 1.20 round number support level.
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 consolidated between the 1.3525 and 1.3570 price range overnight following the move higher from the previous day. Although the DXY strengthened, upside on the USDCAD was resisted by the 1.3570 price level. Look for the USDCAD to complete the retracement at the current price level of 1.3525 and for the price action to signal a continuation of the uptrend. If the USDCAD breaks above 1.3570, the next key resistance is at 1.3710.
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 continued trading lower overnight as the DXY strengthened. WTI currently trades just above the 74.00 price level with further downside anticipated, especially if the DXY continues to strengthen. WTI could trade lower down to retest the support level of 72.50. Similarly, Brent could retest the key support level of 79.00 if the price reversed lower beyond the round number support of 80.00.
Next 24 Hours Bias
Weak Bearish
