What happened across the Asia session?
Most major currencies climbed higher against the US dollar early in the Asia session, as the DXY continued to weaken.
What does it mean for Europe and US Sessions?
Look out for increased volatility on the EURUSD and GBPUSD with major news events due to be released.
The Dollar Index (DXY)
Key news events today
No major news events.
What can we expect from DXY today?
The DXY traded with significant volatility with the price testing the 102.90 support level before retracing sharply higher, reaching an overnight high of 103.40. With no major news events scheduled for the USD, DXY is likely to continue fluctuating within the current range. While current price action indicates a rejection of the upward move, look for the DXY to retrace down toward the near support of 102.90, especially if the price breaks through the round number level of 103.
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 Bearish
Gold (XAU)
Key news events today
No major news events.
What can we expect from Gold today?
Although Gold traded between the price range of 1869 and 1886, the failure to trade significantly lower could signal a brief pause in the downtrend. If the DXY continues to weaken, Gold could trade higher toward the immediate resistance level of 1905. However, this would first require the price to break beyond the near-term high of 1886.
Next 24 Hours Bias
Weak Bullish
The Euro (EUR)
Key news events today
EUR EU Economic Forecasts
What can we expect from EUR today?
The EURUSD traded with choppy price action as the price fluctuated between the 1.0715 and 1.0760 range. In today’s trading session, the EURUSD bounced strongly from the 1.0710 price level to the current level of 1.0745. If the DXY continues to weaken, this could drive the EURUSD higher, with the previous swing high of 1.0760 an intermediate resistance. With the EU Economic Forecast to be released today, anticipate significant volatility on the EURUSD.
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 slides lower following the directional lead from the DXY early in today’s trading session. With the current price action breaking the 0.92 round number support level, further moves to the downside could see the USDCHF test the lower support level of 0.9070.
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
GBP Monetary Policy Report Hearings
What can we expect from GBP today?
Anticipate significant volatility on the GBPUSD with the monetary policy report hearings due today. With the price currently testing the 1.21 price level, the GBPUSD could see significant upside potential if the price breaks above the round number resistance level and the BoE conveys a hawkish sentiment during the hearing. The upside move could find the key resistance level of 1.22. Alternatively, if the GBPUSD reverses from the 1.21 resistance level, significant downside moves could see the GBPUSD reach the key support level of 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 Bullish
The Canadian Dollar (CAD)
Key news events today
No Major News Events
What can we expect from CAD today?
The Canadian dollar weakened overnight following comments from the BoC, indicating a higher bar for interest rates, signaling the potential for further rate increases. The USDCAD ended the session at the 1.3445 price level but is currently retracing to the downside, due to the weakness of the DXY. Look for the USDCAD to retrace lower to retest the 1.34 price level before trading higher again, if the DXY recovers in strength. If the USDCAD resumes with the uptrend, the near term key resistance level is at 1.3560.
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?
Crude loading disruptions in Turkey and optimism over China’s recovering demand continued to buoy sentiment in energy prices. This saw WTI climb up to reach the 78.45 price level while Brent reached the 85.00 price area overnight. Prices could retrace briefly before continuing with the recent uptrend. Anticipating further upside potential, look for WTI and Brent to rise toward the key resistance level of 82.00 and 89.00 respectively.
Next 24 Hours Bias
Weak Bullish
