Daily market review 06 March

The news background on the first trading day of the week will be very weak, so trading activity can be affected negatively. As a consequence markets can regain mood last week.

18:00 ** The change in volume production orders / Factory Orders – USA (January)
The importance of this index is moderate, but its decline may be pressure on the US dollar. At the time of publication may only slightly increase the trading activity of the American currency.

** 23:00 FOMC Member Neil Kashkari will deliver a speech / FOMC Member Neel Kashkari Speaks – USA (March)
Given the proximity of the next FOMC meeting, and as a result of the vote on the rate, comments of the voting members of the committee may be accompanied by the growth of the US dollar in trading activity. Hints at readiness to vote for a raise is a strong bullish signal for the dollar.

EUR / USD
Expectations improve the US Fed rate increase, which greatly complicates the chances of growth of the weak euro. The focus of the week preparations for the elections in France and the battles around the final list of candidates, the decision by the ECB (Thursday, 9 March), as well as statistics on the US labor market, which can change the mood of the American currency buyers (only if the evidence demonstrate a downward dynamics).
In general, the larger EURUSD negative background, because in a number of upbeat news from the US since the beginning of the month, almost no one doubts the likelihood of a rate hike in March, next week. Because of this, dollar pessimists can now turn sharply and enter into long positions on the US dollar.
Note: the weekly chart shows that actively protect the 1.0500 support level. In addition to the strong shadows below, in the last 5 trading days of a strong reversal candlestick configuration “Absorption” was formed, which can not be neglected. Therefore, it is recommended to continue selling after the breakdown level of 1.0500 down to conservative positions. While the pair is trading above 1.0500 – sell if it reverses the hourly charts and hang down from the strong resistance levels. At the present day we select strong range 1,0600-1,0620.

USD / JPY
While sentiment from last week do not change. Looking forward, technically, movement of the pair down. For a guide to the technical support levels, where we can expect decrease in pair, we are sure to put on hour / 4 hour chart USDJPY Fibonacci levels on the growth of the last couple of the low of February 28 and March 2 to the maximum. The first correction (23.6%) at around 113.90 – we have already achieved it. Next, the second level (38.2%) at the level of 113.49. 50% correction at around 113.13.

GBP / USD
Considerable optimism in relation to the pound now is not the experience, although Friday’s daily candle looks like a reversal. The focus, in our view, still a fundamental weakness of the British pound and the stronger US dollar.

Within days: reduce reuse expect quotations GBPUSD to lows last week. We do not rule out that the couple will be able to pass more than 70 points, and start testing the 1.2200 support.

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