What happened across the Asia session?
Most major currencies consolidated against the US dollar during the Asia trading session.
What does it mean for Europe and US Sessions?
Look out for increased price volatility with the DXY likely to continue trading higher.
The Dollar Index (DXY)
Key news events today
No major news events.
What can we expect from DXY today?
The DXY resisted moves to the downside as the price action rejected the 102.90 price level to trade significantly higher on Friday, ending the week at the 103.50 price level. With the uptrend holding strong, a further brief move to the upside can be expected for the DXY. Early in the trading session today, the DXY climbed to test the 103.75 price area, signaling a confirmation of the upside potential. Look for the DXY to break above 103.75 to indicate a continuation of the uptrend, with the next key resistance level at 104.50.
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?
While the DXY strengthens, Gold saw further pressure to the downside as the price ranged between 1854 and 1870 on Friday. Currently trading at the 1861 price level, look for a breakout potential, to the downside, especially if the price closes strongly below 1856. Further strengthening of the DXY could see the price of Gold trade significantly lower, with the lower key support level area of 1800 and 1790 a possible target level.
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 steadily lower on Friday from the 1.0740 price level, ending the trading week at the 1.0675 price level. This move lower was due to the strength of the DXY. With no major news events on the horizon for the EURUSD, the price is likely to see further moves to the downside if the DXY continues to strengthen. Currently, the price action is indicating a brief retrace and could retest the 1.07 price level before trading lower again. If the EURUSD continues with the downtrend, look for the price to slide lower toward the next key support level of 1.0540.
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 Bearish
The Swiss Franc (CHF)
Key news events today
CHF CPI m/m
What can we expect from CHF today?
The USDCHF traded with significantly choppy price action as the price fluctuated between 0.92 and 0.9250 on Friday. Although the price climbed higher at the start of the trading day today, due to the strength of the DXY, the USDCHF could stage a brief correction to the downside. With the CPI data due to be released (Forecast: 0.5% Previous: -0.2%) this could strengthen the CHF if inflation is higher than expected, which could lead to the SNB increasing rates further. Look for the USDCHF to retest the 0.9215 price level before possibly continuing with the uptrend.
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?
The GBPUSD traded lower on Friday, ending the week along the 1.2050 price level. This move lower was driven by the strength of the DXY and the release of weaker-than-expected GDP of -0.5% (Forecast: –0.3%). The GBPUSD is likely to retrace briefly, to test the 1.2080 interim resistance level before trading lower again. If the GBPUSD breaks below 1.2050 to signal further downside potential, the next key support level would be at 1.1960.
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 significantly lower on Friday as the Canadian dollar strengthened following the release of the employment data. Employment change was released at 150k (Forecast: 15k) and the unemployment rate stayed unchanged at 5.0%. With the stronger-than-expected data release, the USDCAD fell to the key support level of 1.3345. As the price completes its retracement, look for price action to develop and signal a continuation of the downside. If the USDCAD breaks below 1.3345, the next support level is at 1.3270. However, anticipating further DXY strength, the DXY could remain trading within the current range of 1.3350 and 1.3450.
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 Bullish
Oil
Key news events today
No Major News Events
What can we expect from Oil today?
Following sanctions on its oil exports, Russia has responded by threatening to cut production levels. This caused energy prices to trade higher on Friday. WTI rose toward the 80.00 price level while Brent climbed to a near-term high at the 87.00 price area. A brief retracement to the downside can be expected as the DXY strengthens. However, look for the retracement to complete before further upside moves with the next resistance levels for WTI and Brent at 82.00 and 89.00 respectively.
Next 24 Hours Bias
Weak Bullish
