Daily market review 10 March

12:30 *** Change in Industrial Production – United Kingdom (January)
12:30 ** Change in Manufacturing Production – United Kingdom (January)
Decrease of these indicators can strengthen the activity of sellers GBP. According to general uncertainty about GBP / USD currency pair, the deterioration of the situation in the industrial sector of the UK economy could put additional pressure on the pair. At the time of publication, we expect an increase in GBP volatility.
16:30 *** Unemployment Rate – Canada (February)
16:30 *** Employment Change – Canada (February)
Economists do not expect any changes in the unemployment rate, but according to them, the number of employees may fall by 4.8 thousand, after two months of growth of this indicator by 46.1 and 48.3 thousand, respectively. Therefore, a slight decrease in the number of employed is unlikely weaken the Canadian dollar. At the same time, important for CAD is the price of oil.
16:30 *** Unemployment Rate – United States (February)
16:30 *** Employment Change – USA (February)
In January, the unemployment rate returned to the level of 4.8%, so reducing the figure to 4.7% is extremely necessary for the Fed and as a consequence of the US dollar. Let us remind you that next week the US Federal Reserve will vote for a change in the rate. For a positive vote, a significant improvement in the labor market is necessary. As a consequence, weak data in the report are negative for USD.

Yesterday’s decision on the ECB rate, we worked out correctly. For today’s dynamics of trading this information will not have an impact. The expectations of the current day are the results of the EU summit in Brussels, and key statistics on the US labor market for February (important information for making a decision on the rate of the Fed.) The meeting is scheduled for March 15.
The demand for the US dollar is low so far, but after the unemployment rate in the US becomes known, as well as NFP, the dynamics will change. If the statistics turn out to be somewhat negative, then we can expect that the dollar will fall, as this factor will lower expectations of a rate hike at subsequent Fed meetings in March. If the statistics are all positive, then we can expect a sharp spike in consumer activity in the US dollar.
Technically important is the resistance of 1.0600. While the pair is trading lower – we are waiting for support to reach 1.0566-1.0557. In case of breakdown up to the level of 1.0600 – growth is possible to the next resistance of 1.0630.

Confident breakdown up to the level of 115.00 creates the prerequisites for reaching such vertices as 116,40-116,80. In any case, for USDJPY currency pair until the sale is opened. To resume the build-up of short positions, you will need to wait for the reversal candle configuration on the daily charts.

At 9:30 GMT, the launch of a portion of news from the UK starts, which will significantly increase the volatility of trading in all currency pairs with the pound. First of all, we note that the deficit of the trade balance for December decreased in January, there may be a moderate deterioration in the indicator, which will be conditioned as the seasonal factor. General moods for the pound remain negative and with the support of negative statistics, will provoke a decline under the level of 1.2200.
At the same time, we should consider that if the statistics on the US labor market are moderately negative, then they can start fixing purchases on the US dollar, and this will support the pound from a sharp drop towards the end of Friday’s trades.

Leave a Reply

Your email address will not be published. Required fields are marked *