In this article, we have covered the highlights of global market news about the GBP/USD, USD/CHF, USD/JPY and USD/CAD.
GBP/USD Price Analysis: Reaches 1.2330 as Dollar Index falls, BoE policy eyed
In the early European session, the GBP/USD pair reached a new daily high of 1.2330. As the Federal Reserve (Fed) nears the stage of tightening policy, more weakening in the US Dollar Index (DXY) supports Cable’s upward tilt. The Pound Sterling is also supported by increasing hawkish bets on the Bank of England (BoE) policy after a surprising increase in UK inflation.
Bank of America Global Research (BoA) economists anticipate a dovish BoE rate increase of 25 basis points.
While attention has turned to risk-perceived assets, the Dollar Index is battling to hold above 102.00 and is likely to continue falling. Strong gains in S&P500 futures suggest that market participants’ appetite for risk has returned.
On a four-hour time frame, the GBP/USD currency pair trades in a Rising Channel chart pattern, where market players see each retreat as a buying opportunity. The Cable is moving toward the horizontal resistance indicated by the high price of 1.2444 on December 13.
The bulls of the pound sterling are getting some support from the 20-period Exponential Moving Average (EMA) around 1.2245.
A further gain is predicted when the Relative Strength moves from the negative 20.00–60.00 zone into the bullish 40.00–80.00 level.
USD/CHF Price Analysis: Go for 0.9080 support as the SNB prepares to raise interest rates.
Going into Thursday’s European session, the USD/CHF shows a three-day decline at its lowest point in a week, down 0.25% intraday at 0.9155 as sellers of the pair prepare for the Swiss National Bank’s (SNB) Interest Rate Decision.
In doing so, the Swiss Franc (CHF) pair sellers applaud the quote’s continuous trading below the declining resistance line that has been present for two weeks and a shift away from the 100-DMA. It’s important to note that the USD/CHF prices are also being pressured downward by the negative MACD indications and the bearish RSI (14), which is not oversold.
As a result, the pair is poised to collapse toward a seven-week-old ascending support line, which is close to 0.9080 at the time of publication.
The RSI circumstances, however, are closer to the oversold area, making the USD/CHF pair’s decline beyond 0.9080 illusive.
The 0.9000 psychological magnets and the 61.8% Fibonacci Expansion (FE) of the pair’s movements between November 10, 2022, and March 03, 2023, at 0.8915, may come to the market’s notice if the quote falls below 0.9080.
Alternatively, the short-term USD/CHF upside is constrained before the 100-DMA resistance around 0.9335 by the convergence of the 50-DMA and a two-week-old resistance line, most recently near 0.9255.
USD/JPY licks Fed-inflicted wounds at six-week low under 131.00 as yields continue weak
Early Thursday morning in Europe, bids for the USD/JPY increased to reverse afternoon losses at 130.80. As a result, the Yen pair recovers from a six-week low set earlier in the day as traders look for other cues to prolong Federal Reserve (Fed) inducements. The primary decision-makers denial of the financial crisis and the pessimistic findings of Japan’s Reuters Tankan survey may strengthen the corrective bounces.
For the third consecutive month in March, major Japanese manufacturers expressed pessimism about the state of the economy, according to the highly monitored Reuters Tankan survey released early on Thursday. According to a study conducted March 8–17, “the mood index for major manufacturers remained at minus 3 compared to minus 5 observed in the previous month,” according to Reuters.
The attempts of Citibank CEO Jane Fraser eased market concerns by stating, “Credit is not in trouble here. In this case, there are a few banks, “Bloomberg. It should be highlighted that several central bank officials have attempted, but so far failed, to disprove early concerns about the 2008 financial catastrophe. However, their prompt response to the consequences of Silicon Valley Bank (SVB), Signature Bank, and Credit Suisse is praised and delays the likelihood of the market’s demise.
USD/CAD Price Analysis: Sellers hit 1.3660 support confluence to open 100-pip drop
As we approach Thursday’s European session, USD/CAD reverses from a two-week-old resistance line to record the first daily loss in three. The Loonie pair does this by pricking a crucial support confluence of the 21-day Exponential Moving Average (EMA) and a horizontal line extended from early January, the initial resistance.
In addition to the bearish MACD signals and the downward-sloping RSI (14) line, which is not oversold, the failure to cross a short-term descending resistance line also favors the sellers of the Loonie pair as they approach the 1.3660-65 support confluence.
The monthly low of 1.3555, which is also the 50% Fibonacci retracement of the pair’s February-March upside, is highlighted by the USD/CAD bearish’ expectation that it would breach the 1.3660 level, which would trigger a near 100 pip southward run.
The swing high from January 19 and the 61.8% Fibonacci retracement level, commonly known as the golden Fibonacci ratio, might provide challenges to the USD/CAD bears at 1.3520 and 1.3490 in that order during the quote’s fall beyond 1.3555.
The capacity of the Loonie pair to offer a daily closing above the resistance above the line, which is now at 1.3725, is necessary for recovery advances.
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