What happened in the US session?
Most major currency pairs traded lower against the US Dollar as the DXY strengthened overnight. The S&P closed slightly lower by 0.16% to reach the 3,991 price level.
What does it mean for the Asia Session?
Look for increased price volatility following the RBNZ rate decision.
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 Australian Dollar (AUD)
Key news events today
No major news events.
What can we expect from AUD today?
The AUDUSD continued its slide to the downside, reaching the 0.68 round number support level overnight. However, the price failed to break the support and bounced to retrace briefly. Currently trading at the 0.6830 price area, the AUDUSD could continue to trade slightly higher to the 0.6850 price level before continuing with the downtrend again. If the AUDUSD breaks below 0.68, the next key support level is at 0.6660.
Central Bank Notes:
- Cash rate stands at 3.35%
- Future rate rises are expected as RBA targets the 2-3% inflation target.
- Next meeting on 7 March 2023
Next 24 Hours Bias
Weak Bearish
The Kiwi Dollar (NZD)
Key news events today
No major news events.
What can we expect from NZD today?
Unlike the AUDUSD, the NZDUSD resisted significant moves to the downside as the price was supported at the 0.62 price area. As the price fluctuates between the 0.62 and 0.6250 price range, look for a potential breakout to the upside. If the price breaks above 0.6250, the NZDUSD could climb to the key resistance level of 0.63.
Central Bank Notes:
- Cash rate stands at 4.75%
- Central bank is likely to continue with the current path of rate adjustment
- Next meeting is on 5 April 2023
Next 24 Hours Bias
Weak Bullish
The Japanese Yen (JPY)
Key news events today
No major news events.
What can we expect from JPY today?
Overnight, the USDJPY tested the 135-round number resistance level several times but failed to break higher, despite the strength of the DXY. Currently trading at the 134.80 price level, look for the USDJPY to consolidate briefly before potentially breaking out to the upside. If the price breaks above the 135 price level, the next key resistance level for the USDJPY is 138.
Central Bank Notes:
- Cash rate stands at -0.1%
- Expanded range for 10 year JGB yield fluctuations to 0.5%
- Next meeting is on 8 March 2023
Next 24 Hours Bias
Weak Bearish
