Daily Market Report

07/03/2023
11:20

The US Dollar started the week on a negative note as traders await Fed’s Powell speech and the latest change in the Non-Farm payrolls.

On the other side, the Dow and S&P500 indices closed modestly higher while the Nasdaq was slightly lower ahead of a busy week. Moreover, Oil prices succeeded to extend last week’s advance, stabilizing above the psychological barrier of $80 per barrel.

Looking at today’s important economic releases, investors will be looking for the Reserve Bank of Australia’s interest rate decision. In the UK, the Halifax house price index is expected to have declined from 0.0% to -0.3% in February.

Below, we will be analyzing the latest price action developments in the major currency pairs alongside gold.

EURUSD

The Euro managed to extend its advance on Monday after successfully breaking above the falling trendline drawn from the 1.0800 high.

Looking at the short-term price action, we can see that momentum has turned positive as the single currency showed a series of higher lows since the 1.0535 bottom, however, a breakout above the 1.0700 barrier is needed to confirm a new higher high, which can lead to a continuation higher toward 1.0770-1.0800 resistance zone in the coming days.

For the time being, we might see new sellers near the 1.0700 level which represents the hourly resistance for the Euro in the short term. Meanwhile, if the pair continues to trade above 1.0620 support, the bullish momentum is expected to remain unchanged.

To conclude, the hourly trend has become positive, and the Euro is likely to remain well-supported above the 1.0620 low.

GBPUSD

The British pound is trying to validate a potential bullish reversal in the near term.

As of now, the trend remains neutral, and traders should wait for more price action to confirm the next direction in this pair. Technically, the important support is located at 1.1990 while the key resistance level for today stands at 1.2050 followed by 1.2090 in extension.

When looking at the latest price developments, we can see that the pair managed to bounce from the daily support of 1.1920 for three consecutive times which reinforces the probability of a bullish reversal in the coming hours.

However, a break above the 1.2050 hourly resistance coupled with a penetration of the hourly falling trendline is needed to confirm the positive scenario.

On the other side, a daily close below 1.1990 support will put the pair under pressure again.

USDJPY

The buying pressure m remains intact in this pair despite the latest decline by the end of last week which should be considered temporary.

Looking at the recent price action, the pair managed to bounce back near the formerly broken resistance zone located between 135.35 and 135.00 levels. This zone will be playing the role of important support in the near term. Therefore, traders should keep an eye on it in the coming hours to assess the strength of the current uptrend.

The pair is following a series of higher highs and higher lows and buyers will likely target the hourly resistance of 136.40. In the meantime, the pair is expected to trade sideways to higher.

USDCAD

The pair is trading sideways since finding strong resistance from the hourly resistance zone located between the 1.3665 and 1.3685 levels.

Technically, the momentum remains positive as buyers managed to push prices above 1.3520. This level was acting as a formerly broken resistance and for the time being, it should act as new support when tested.

From an intraday perspective, we can see that prices are trading sideways inside a range located between the 1.3665 resistance and 1.3520 support, meanwhile, prices are expected to stabilize in the coming hours.

Traders should wait for a clear break outside of the current range before confirming the future path in this pair.

GOLD

Gold retreated due to profit-taking after the recent bounce that started from 1805 support.

Earlier last week, the yellow metal succeeded to clear the short-term barrier of $1830 per ounce and break above the falling trendline drawn from the 1870 high which keeps the near-term positive momentum unchanged.

In the coming hours, we can see a continuation of the downside correction, however, any drop is likely to be temporary and new buyers are expected to appear around 1840 support which is considered as the hourly support followed by 1830 in extension.

After the end of the current corrective move, higher prices are expected, and buyers will likely target the 1860 resistance level.

Economic Analyst
Amine Hiani