3 March, 2017
The U.S. dollar index edged higher and is seen maintaining gains for three consecutive days. The Greenback will most likely come under pressure today as expectations build for the Fed Chair to comment on the March rate hike. So far, economic data remains supportive for the case of rate hike with many other FOMC members supporting the hawkish view as well. The U.S. dollar closed stronger on the day across the board.
Looking ahead, the economic calendar today will see the services PMI from Markit for the Eurozone and the UK. In the U.S. session, the ISM non-manufacturing PMI data will be released while later in the evening, Fed Chair Janet Yellen will be speaking at an event in Chicago. Other FOMC member speeches today include that of Charles Evans from Chicago Federal Reserve, and Fed Governors, Jerome Powell, and Stanley Fischer.
GBPUSD intra-day analysis
GBPUSD (1.2266): GBPUSD continued to drift lower following the break below 1.2400. Yesterday's construction PMI did not help in lifting the sentiment as data came out only slightly better than expected at 52.5 compared to 52.2. The focus will be on today's services PMI which could see some continued improvement. The British pound was also hit by the fact that the Prime Minister lost the Brexit bill in the House of Lords. The currency continues to be hit by weak sentiment on the Brexit issue which could keep the markets subdued. GBPUSD will be looking to push lower towards the support level at 1.2200 in the near term; however, watch for a pullback as the Stochastics on the daily, and 4-hour chart remains strongly oversold.
USDJPY intra-day analysis
USDJPY (114.17): USDJPY broke past 114.00 resistance level, but the question is whether these gains can be maintained. On the 4-hour chart, price action is seen posting a reversal off 114.38 - 114.00 resistance level and could see a continued decline back towards 113.00 if the pullback persists. Therefore, it is ideal to expect further bullish continuation only above 114.38 while below this level there is a risk of a decline in prices towards 113.00. This view is also validated by the fact that there is a hidden bearish divergence on the 4-hour chart with prices making a lower high and the Stochastics printing a higher high.
XAUUSD intra-day analysis
XAUUSD (1232.35): Gold prices closed near the 1240 - 1235 support handle yesterday, and a bearish close is required to confirm the continuation to the downside. Watch for a potential bounce off the support level which could trigger a short term pull back in prices. On the 4-hour chart, price action is seen breaking out from the rising median line, but there is scope for a retest in prices to the upside back to 1250.00 unless gold resumes the declines to test the support at 1220 - 1217 region.
The greenback continued to weaken against some of the major currencies yesterday amid a quiet trading day...
The US dollar index will be looking to a fresh week with the possibility of a rebound following last week's sharp declines..
The US dollar managed to stem the strong declines after developments from Washington...
The euro surged ahead to a fresh 6-month high earlier this morning as the price was seen tradingþ...
The US dollar extended declines strongly for another day as economic data...
The latest monthly manufacturing activity report released by the New York Fed yesterday...
The US dollar fell sharply on Friday after data showed that consumer price index rose 0.2%...
Economic data from the US continued to remain robust with the initial jobless claims declining to 236,000 for the week...
The Bank of England meeting, industrial and manufacturing production numbers and fresh inflation forecasts...