In this article, we have covered the highlights of global market news about the EUR/USD, GBP/USD, USD/CHF and AUD/USD.
EUR/USD Price Analysis: Sits around 1.0600 on the bull’s radar.
Early on Tuesday, at 1.0600, the EUR/USD bulls pause following the previous day’s largest daily rise in over a month. However, the important currency pair is still headed for its first monthly loss in five months.
Yet, the prolonged price movement above the 1.0530 support level and the unambiguous upward breach of the last resistance line from February 14 provide the short-term EUR/USD buyers reason for optimism.
It’s important to note that the 1.0530 level is highlighted as the direct support by the 50-day Exponential Moving Average (EMA) and 61.8% Fibonacci retracement level of the pair’s movements between late November 2022 and early February 2023.
The EUR/USD pair’s recent immobility at round number 1.0600, with the bearish MACD signals and pessimistic RSI (14), challenges the bulls below the 1.0665 50-day EMA threshold.
Hence, the EUR/USD is still on the bull’s radar, but the recovery movements require confirmation from the 1.0665 barriers. If this barrier is broken, the quotation may swiftly move toward the mid-February swing high, which is around 1.0800.
GBP/USD bulls maintain control as the US dollar remains weak.
While markets maintain their opening range and US “Dollar weakening that started to emerge at the beginning of the week, GBP/USD is unchanged in Asia. GBP/USD is now trading at 1.2065 and within the 1.2042/67 range. In addition to the US Dollar’s decline, British Prime Minister Rishi Sunak’s signing of a new trade agreement with the EU has caused sterling to rise from a 7-week low.
Although a new deal, known as the Windsor Framework, has been negotiated between the two parties, the Northern Ireland Protocol has recently influenced the Pound’s currency market trajectory. The agreement is intended to maintain commercial flows inside the UK and preserve Northern Ireland’s status as a member of the UK. The Guardian says the prime minister is not out of the woods. There could be resignations of ministers if the details are revealed.
Mr. Sunak asserts that “the right time for the parliament to vote will be observed.” In contrast to his potential rivals, which could otherwise find a way to organize a vote at a time when it would be most dangerous and compel the government to win with Labour backing, harming, maybe fatally, Mr. Sunak, he now has the benefit of timing.
USD/CHF remains weak in the mid-0.9300s ahead of the Swiss GDP.
The USD/CHF currency pair exhibits pre-data jitters as it moves up to 0.9350 early on Tuesday. Yet, the Swiss currency pair can retain the first monthly gain in four thanks to market caution and widespread US Dollar weakening.
The recent cautious optimism was supported by the White House’s trade-friendly headline and a decline in US Treasury bond rates.
Notwithstanding its political problems with the dragon kingdom, the US nonetheless extends an olive branch to China’s business community, allowing the S&P 500 Futures to follow Wall Street’s gains as of publication. According to Politico late Monday, US President Joseph Biden “is likely to skip substantial new limits on US investment in China, despite frayed ties with Beijing, dismissing a drive by certain hawks in his administration and Congress.”
It’s essential to remember that although the S&P 500 Futures print modest gains by matching Wall Street’s cheerful ending, during the quiet hours of Tuesday’s trade, US Treasury bond rates continue to be subpar.
On Monday, US durable goods orders fell -4.5% in January, below the -4.0% forecast and 5.1% lower than in December. Nevertheless, compared to analysts’ predictions of 0.0% growth and -0.3% prior readings, the Nondefense Capital Goods Orders ex Aircraft increased by 0.8%. Similarly, US Pending House Sales increased by 8.0% MoM, exceeding expectations of 1.0% and previous levels of 1.1%.
AUD/USD bounces from a multi-day low toward 0.6800 on optimistic Australia Retail Sales.
Strong Australia Retail Sales encourage AUD/USD bulls to push the week-start comeback beyond 0.6750 early on Tuesday. The Australian pair likewise applauds the risk-on sentiment, lower US Treasury bond rates, and mixed economic data by doing this.
Despite this, Australia’s seasonally adjusted Retail Sales increased 1.9% MoM vs. 1.5% market expectations and -3.9% prior readings, allowing the Australian pair to regain an intraday high at 0.6750.
In addition to the encouraging Australian statistics, a trade-friendly headline from the White House also seems to be supporting the rebound of the AUD/USD pair, mainly since the pair is seen as a risk barometer.
Notwithstanding its political problems with the dragon kingdom, the US nonetheless extends an olive branch to China’s business community, allowing the S&P 500 Futures to follow Wall Street’s gains as of publication.
Politico claimed late Monday that US President Joseph Biden was “expected to skip substantial new limits on US investment in China, despite eroding ties with Beijing, dismissing a drive by certain hawks in his office and Congress.”
Nonetheless, the global problems, aggressive Fed discussions, and impending worries about the Australian recession all appear to keep AUD/USD sellers optimistic.