20/03/2023 Daily Reports
Support Level: 1.0600 - 1.0510 - 1.0440 Resistance Level: 1.0685 - 1.0760 - 1.0800
EUR/USD
- Financial markets were on a bumpy road this week amid concerns about the banking sector’s health. The EUR/USD pair traded between 1.0515 and 1.0759 to settle above the 1.0600 mark, marginally lower from Monday’s opening.
- Later on Friday, Industrial Production data for February and the University of Michigan’s flash Consumer Sentiment Survey for March will be featured in the US economic docket. Following this week’s highly volatile action, these data releases are unlikely to have a significant impact on the US Dollar’s valuation. Instead, market participants will pay close attention to risk perception. If Wall Street’s main indexes manage to build on Thursday’s strong gains, EUR/USD could preserve its bullish momentum toward the end of the week.
- The EUR/USD pair is trading near the 1.0665, up for the day with bullish stance in daily chart. The pair stabilized between 20 and 50 SMA, indicates neutral strength. Meanwhile, the 20 SMA started turning flat but continued developing below 50 SMA, suggests bears not exhausted yet. On upside, the immediate resistance is 1.0685, break above this level will extend the advance to 1.0760.
- Technical readings in the daily chart support the neutral stance. The RSI indicator stabilizes around 50. The Momentum indicator holds near the midline, indicating directionless potentials. On downside, the immediate support is 1.0600 and below this level will open the gate to 1.0510.
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Support Level: 1.2100 - 1.2010 - 1.1920 Resistance Level: 1.2200 - 1.2270 - 1.2450
GBP/USD
- The Pound Sterling regained the upper hand against the USD, despite the global banking sector tensions. The GBP/USD pair added more than 100 pips over the week, having found strong support at the 1.2000 psychological level.
- Markets are currently pricing in a nearly 90% probability of a 25 basis points Fed rate hike at next week’s policy meeting. The data releases from the US on Friday, Industrial Production and the University of Michigan’s Consumer Confidence Index, are unlikely to alter the market positioning in a significant way. Hence, the risk perception should continue to influence the US Dollar’s valuation.
- The GBP/USD offers bullish stance in daily chart. Cable stabilizes above 20 and 50 SMA, indicating bullish strength in short term. Meanwhile, the 20 SMA started turning north and heading towards longer ones, suggests bulls not exhausted yet. On upside, the immediate resistance is 1.2200 with a break above it exposing to 1.2270.
- Technical readings in the daily chart support the bullish stances. RSI indicator stabilizes around 57, while the Momentum indicator stabilizes above the midline, suggesting upward potentials. On downside, the immediate support is 1.2100, unable to defend this level will resume the decline to 1.2010.
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Support Level: 1958 - 1920 - 1886 Resistance Level: 2000 - 2030 - 2070
XAU/USD
- Gold price moved further to the upside during the American sessions, breaking above $1,980. Late on Friday, XAU/USD stands at $1,988 the highest level since April 2022 and on its way to the third-highest weekly close on record.
- From the level it had a week ago, the yellow metal is up by 6.3%. A sharp reversal in Treasury yields is driving the rally in Gold price. Bonds are having the week in years. Financial turmoil weighed on monetary policy expectations and the economic outlook. Next week the Federal Reserve will announce its decision. A 25 basis point rate hike is expected. A few days ago analysts were asking 25 or 50 after US inflation and employment data. The new scenario includes the odds of a pause at the upcoming meeting. Things have changed dramatically, triggering an impressive rally in XAU/USD.
- Gold price stabilized around 1988, up for the day and bullish in the daily chart. The gold price still stabilizes above all main SMAs, suggesting bullish strength in short term. Meanwhile, the 20 and 50 SMA started turning north and continued developing far above 200 SMA, indicates bulls not exhausted yet. On upside, the immediate resistance is 2000, break above this level will open the gate for more advance to 2030 area.
- From a technical perspective, the RSI indicator holds above the mid-line and stabilizes around 75, on a bullish strength. The Momentum indicator hold in the positive territory, suggests upward potentials. On downside, the immediate support is 1958, below this area may resume the decline to 1920.
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Support Level: 131.00 – 129.70 – 127.20 – 129.80 Resistance Level: 133.80 – 135.10 – 137.00
USD/JPY
- The USD/JPY pair fails to capitalize on the previous day’s solid recovery of over 200 pips from its lowest level since February 14 and comes under some renewed selling pressure on Friday. It dropped further, falling to as low as 131.54 and ended the week around 131.82, still bearish in the daily chart.
- Growing acceptance that the Federal Reserve will adopt a less hawkish stance at its upcoming meeting on March 21-22 exerts fresh downward pressure on the US Dollar, which, in turn, is seen weighing on the USD/JPY pair. In fact, the markets are now pricing in a greater chance of a smaller 25 bps lift-off in the wake of last week’s collapse of two mid-size US banks – Silicon Valley Bank and Signature Bank. This leads to a fresh leg down in the US Treasury bond yields and continues to undermine the Greenback.
- The USD/JPY pair stabilized around 131.80, down for the day and bearish in the daily chart. The price stabilizes below 20 and 50 SMA, suggests bearish strength in short term. Meanwhile, 20 SMA started turning north and heading towards longer ones, indicating bears not exhausted. On upside, overcome 133.80 may encourage bulls to challenge 135.10, break above that level will open the gate to 137.00.
- Technical indicators suggest the bearish strength. RSI stabilizes around 39, while the Momentum indicator stabilizes below the midline, suggests downward potentials. On downside, the immediate support is 131.00, break below this level will open the gate to 129.70 area.
Support Level: 31950 - 31790 - 31640 Resistance Level: 32250 - 32580 - 32900
DJI
- DJI under the sell pressure on Friday, dropped from intraday high 32576 area to low 31949. It recovered modestly and ended the week around 32050, down for the day and indicates bearish sign in the hourly chart. Right now market is standing below 20 and 50 SMA, suggests bearish strength. Meanwhile, 20 SMA started turning south and heading towards longer ones, suggests bears not exhausted yet. On upside, overcome 32250 may encourage bulls to challenge 32580, break above that level will open the gate to 32900.
- Technical indicators suggest the bearish movement. RSI stabilizes around 38, while the Momentum indicator stabilizes in negative territory, suggests downward potentials. On downside, the immediately support is 31950, break below this level will open the gate for more decline to 31790 area.
Support Level: 71.40 – 70.00 – 69.30 Resistance Level: 74.20 – 76.00 – 78.70
BRENT
- Brent under the sell pressure on Friday, dropped from intraday high 75.92 area to low 71.42. It recovered modestly and ended the week around 72.48. The price currently stabilizes below 20 and 50 SMA, suggests bearish strength in the hourly chart. Meanwhile, the 20 and 50 SMA started turning south and continued developing far below 200 SMA, indicates bears not exhausted yet. On upside, overcome 74.20 may encourage bulls to challenge 76.00, break above that level will open the gate to 78.70.
- Technical indicators also suggest bearish movement, hovering below the midline. RSI stabilizes at 35, while the Momentum indicator stabilizes in negative territory, suggests downward potentials. On downside, the immediately support is 71.40, break below this level will open the gate for more decline to 70.00 area.
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