02/03/2023 Daily Reports
- The EUR/USD retreated after the release of the ISM Manufacturing PMI that boosted, at least momentarily, the US Dollar across the board. The pair pulled back from 1.0691, the highest level in a week to 1.0660.
- Data released in the US showed activity in the Manufacturing sector contracted again in February with the ISM PMI rising from 47.4 to 47.7 (below 50 marks contraction), against market consensus of 48. The Price Paid Index rose from 44.5 to 51.3, surpassing expectations of a 45 reading.
- The Euro is among the top performers on Wednesday following German inflation data that came in above expectations. The figures add pressure to the European Central Bank. A 50 basis point rate hike seems warranted in March and the focus is on the meetings ahead.
- The EUR/USD pair is trading near the 1.0660, up for the day with bearish stance in daily chart. The pair still stabilized below 20 and 50 SMA, indicates bearish strength. Meanwhile, the 20 SMA started turning south and heading towards longer ones, suggests bears not exhausted yet. On upside, the immediate resistance is 1.0700, break above this level will extend the advance to 1.0800.
- Technical readings in the daily chart support the bearish stance. The RSI indicator stabilizes around 46. The Momentum indicator holds below the midline, indicating downward potentials. On downside, the immediate support is 1.0530 and below this level will open the gate to 1.0470.
- GBP/USD is sliding, even though the market sentiment is upbeat on positive data from China. In addition, a Bank of England (BoE) official was more hawkish than expected, sponsoring a leg-up in the GBP/USD. At the time of writing, the GBP/USD exchanges hands at 1.2020, below its opening price by 0.1%.
- Sentiment turned mixed in the session. Data from China revealed that manufacturing activity in the second-largest economy entered the expansionary territory, a tailwind for riskier assets. That boosted global equities with the Dow Jones trading in the green while the S&P 500 and the Nasdaq fluctuated. At the same time it weakened the US Dollar, pushing down the Cable.
- On Brexit news, the Senior Democratic Unionist Party official, Charles Whip Wilson, said that the party is studying the new Northern Ireland trade deal’s details and would not make a knee-jerk decision on whether to accept it. Wilson said that was “an indication that the government knew this deal was not great and was trying to persuade unionists to accept it on the basis that we have great respect for the monarchy.”
- The GBP/USD offers bearish stance in daily chart. Cable stabilizes below 20 and 50 SMA, indicating bearish strength in short term. Meanwhile, the 20 SMA continued accelerating south and heading towards longer ones, suggests bears not exhausted yet. On upside, The immediate resistance is 1.2150 with a break above it exposing to 1.2270.
- Technical readings in the daily chart support the bearish stances. RSI indicator stabilizes around 44, while the Momentum indicator stabilizes below the midline, suggesting downward potentials. On downside, the immediate support is 1.1910, unable to defend this level will resume the decline to 1.1840.
- Gold price (XAU/USD) begins March on a firmer footing as it refreshes intraday high near $1,838 during the three-day winning streak amid the end of the day.
- Strong prints of China’s Caixin and NBS Manufacturing PMIs for February join the Non-Manufacturing PMI for the said month to mark an upbeat economic rebound in the world’s biggest industrial player, as well as one of the major Gold consumers. Following the data, China Finance Minister Liu He showed readiness to bolster the nation’s fiscal spending while also mentioning that the foundation of China’s economic recovery is still not stable.
- Elsewhere, recently softer US data weighed on the US Dollar Index, which prints mild losses after the biggest monthly gains since September 2022 and allows the Gold buyers to keep the reins. However, hawkish concerns surrounding the US Fed and fears of more inflation crunch moving forward seem to keep a tab on the XAU/USD price.
- Gold price stabilized around 1838, up for the day and bearish in the daily chart. The gold price stabilized below 20 and 50 SMA, suggesting bearish strength in short term. Meanwhile, the 20 SMA continued accelerating south and heading towards longer ones, indicating bears not exhausted yet. On upside, the immediate resistance is 1845, break above this level will open the gate for more advance to 1870 area.
- From a technical perspective, the RSI indicator holds below the mid-line and stabilizes around 44, on a bearish strength. The Momentum indicator hold below the midline, suggests downward potentials. On downside, the immediate support is 1800, below this area may resume the decline to 1788.
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- The USD/JPY remains pressured, though capped by recent US economic data, as the US ISM Manufacturing PMI for February fell short of estimates. However, some subcomponents show that again prices are rising. The USD/JPY is exchanging hands at 136.20.
- US equities are trading mixed after the release of the ISM. The reading came at 47.7, below estimates of 48 for February, meaning that factories still feel the impact of the Fed aggression. Delving into the report, the Prices Index rose to 51.3, past the 45.1 estimates, spurring a knee-jerk reaction in the US Dollar Index ,and the USD/JPY spiked to 136.31.
- Lately, investors have turned less optimistic about inflation in the United States (US). Money market futures are pricing the Federal Funds Rate at around 5.25% -5.50% by June 2023, and no rate cuts throughout the year. Earlier, S&P Global Manufacturing PMI for the US came shorter than the prior’s month data, at 47.3 vs. 47.8, a prelude of what was coming, later with data released by the ISM.
- The USD/JPY pair stabilized around 136.20, unchanged for the day and bullish in the daily chart. The stabilizes above 20 and 50 SMA, suggests bullish strength in short term. Meanwhile, 20 SMA continued accelerating north and heading towards longer ones, indicating bulls not exhausted. On upside, overcome 137.00 may encourage bulls to challenge 138.20, break above that level will open the gate to 139.60.
- Technical indicators suggest the bullish strength. RSI stabilizes around 68, while the Momentum indicator stabilizes in the positive territory, suggests upward potentials. On downside, the immediate support is 135.20, break below this level will open the gate to 134.00 area.
- DJI still under the sell pressure, tumbled from intraday high 32780 area to low 32530. It recovered some losses and ended Tuesday around 32700, unchanged for the day and indicates directionless sign in the hourly chart. Right now market is standing between 20 and 50 SMA, but maintains the downward slope, suggests bearish strength. Meanwhile, 20 and 50 SMA continued developing far below 200 SMA, suggests bears not exhausted yet. On upside, overcome 32790 may encourage bulls to challenge 33030, break above that level will open the gate to 33270.
- Technical indicators suggest the directionless movement. RSI stabilizes around 50, while the Momentum indicator stabilizes near the midline, suggests neutral potentials. On downside, the immediately support is 32500, break below this level will open the gate for more decline to 32300 area.
- Brent continued the advance on Wednesday, climbed from intraday low 82.60 to high 84.49. It hold near the to and ended the day around 84.40. The price currently stabilizes above 20 and 50 SMA, suggests bullish strength in the hourly chart. Meanwhile, the 20 SMA continued accelerating north and developing above longer ones, indicates bulls not exhausted yet. On upside, overcome 84.50 may encourage bulls to challenge 85.70, break above that level will open the gate to 87.00.
- Technical indicators also suggest bullish movement, hovering above the midline. RSI climbs to 61, while the Momentum indicator stabilizes in positive territory, suggests upward potentials. On downside, the immediately support is 82.60, break below this level will open the gate for more decline to 81.70 area.
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