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EUR/USD Reacts to US Dollar Strength and ECB Tone | FUNDAMENTALThe EUR/USD pair experienced a pullback from its lowest levels in six weeks as the US Dollar gained momentum, reaching nearly a two-month high. The Euro's decline was influenced by softer EU inflation data and a downbeat tone from ECB's de Cos. Meanwhile, the US Dollar benefited from optimism surrounding a potential extension of the US debt limit and increased expectations of a June rate hike by the Federal Reserve (Fed). Market sentiment dwindled heading into the European session on Thursday, further pressuring the EUR/USD pair, which was trading near 1.0840, down 0.05% intraday. Traders expressed doubts about the ECB's hawkish bias compared to the growing likelihood of a Fed rate hike in June. Recent interest rate futures indicated a 20% probability of a 0.25% rate increase by the Fed in June, contrasting with expectations of no such actions in 2023. This hawkish sentiment was influenced by positive US economic data and hawkish comments from Fed officials. US Housing Starts for April were slightly below expectations, with figures of 1.401 million compared to the anticipated 1.4 million. Building Permits for the same month also declined, reaching 1.416 million compared to the previously revised 1.437 million. However, upbeat US Retail Sales and Industrial Production data for April supported the hawkish stance of the Fed and fueled risk appetite. Federal Reserve Bank of Chicago President Austan Goolsbee and Atlanta Fed President Raphael Bostic were among the officials who reiterated concerns about inflation and favored the EUR/USD bears. In the Eurozone, the final readings of April's inflation based on the Harmonized Index of Consumer Prices (HICP) showed a slight decrease in the monthly rate to 0.6% compared to the previous estimate of 0.7%. However, the annual forecasted increase of 7.0% was confirmed. Following the inflation data, ECB policymaker and Bank of Spain's Governor Pablo Hernandez de Cos stated in an interview that "The persistence of higher inflation would slow the recovery and would very likely lead to further tightening in the euro area." Apart from the Fed-ECB dynamics, comments from US President Joe Biden and House Speaker Kevin McCarthy reassured the markets that they would work together to avoid a catastrophic default. This boosted market sentiment and supported the US Dollar. The US Dollar Index (DXY) remained mildly bid near 102.90, marking its highest levels in seven weeks. Looking ahead, market participants are anxiously awaiting ECB President Christine Lagarde's speech and US President Biden's assurance of a budget solution by the end of Sunday. These factors, combined with second-tier US data and discussions on the US debt limit, will likely shape the direction of the EUR/USD pair in the near term.
by FOREXN1
6
USD/JPY Resumes Upside Momentum - Fundamental AnalysisThe USD/JPY pair has continued its upward trajectory following a slight correction below 136.50 during the Asian session. The focus now is on reclaiming Tuesday's high at 136.68, as the Japanese Yen struggles to gain strength despite positive Q1 Gross Domestic Product (GDP) figures. While concerns about the US debt ceiling persist, the recent release of weaker-than-expected Chinese macroeconomic data has heightened fears of a recession and dampened investor appetite for riskier assets. However, despite these challenges, the overall fundamental landscape appears to favor bullish traders, indicating that the path of least resistance for the USD/JPY pair remains to the upside. Looking ahead, the next significant resistance zone is expected around 138.000, which could serve as a crucial level for determining further price movements.
Long
by FOREXN1
15
Bullish Momentum Continues for USD/JPY PairThe USD/JPY pair has been on a steady rise, building on its overnight goodish rebound from the 133.75 region, which was a one-week low. For the second successive day on Friday, it has gained some follow-through traction, maintaining its bid tone through the early part of the European session and currently placed around the 134.70 region, up over 0.20% for the day. The equity markets have a generally positive tone, and the Bank of Japan's (BoJ) dovish outlook is undermining the safe-haven Japanese Yen (JPY) and turning out to be a key factor acting as a tailwind for the USD/JPY pair. The BoJ Governor Kazuo Ueda, speaking in parliament earlier this week, said that it was too early to discuss specific plans for an exit from the massive stimulus programme. In contrast, the US Dollar (USD) reverses a modest intraday dip and stands tall near a one-and-half-week high touched on Thursday, which lends additional support to the USD/JPY pair. The uncertainty over the Federal Reserve's (Fed) next policy move, along with a modest uptick in the US Treasury bond yields, continue to underpin the Greenback, though the US debt ceiling concerns act as a headwind. The US CPI report released earlier this week pointed to signs of easing inflationary pressure and reaffirmed market expectations about an imminent pause in the Fed's year-long rate-hiking cycle. However, investors remain divided over the possibility of rate cuts later this year. This, in turn, holds back the USD bulls from placing aggressive bets and might keep a lid on any meaningful upside for the USD/JPY pair, at least for now. Market participants now look forward to the release of the Preliminary Michigan Consumer Sentiment Index from the US, due later during the early North American session. This, along with the US bond yields, will influence the USD price dynamics and provide some impetus to the USD/JPY pair. Apart from this, traders will take cues from the broader risk sentiment to grab short-term opportunities on the last day of the week. From a technical perspective, the price of the USD/JPY pair may reach the 137.000 area or even go up to 138.000 before seeing a retracement. The current bullish trend of the pair seems to be supported by the positive market sentiment and the dovish stance of the Bank of Japan, as well as the uncertainty over the Fed's next policy move. However, the possibility of rate cuts later this year and the US debt ceiling concerns may limit the USD bulls' aggression, preventing a significant upside for the USD/JPY pair. Overall, the short-term opportunities in the USD/JPY pair will depend on the broader market sentiment and the release of key economic indicators.
by FOREXN1
10
GBP/USD Dips as USD Strengthens | Fundamental AnalysisIn the early European session, GBP/USD is declining towards 1.2400. The British pound is under pressure due to increased demand for the US Dollar, as investors assess US debt ceiling discussions alongside mid-tier US housing data. The US Dollar (USD) has gained momentum and reached a five-week high following hawkish comments from Cleveland Fed President Loretta Mester. Mester's remarks signaled that interest rates are not restrictive enough and that the central bank is not yet inclined to hold rates steady. This led to a significant rise in US Treasury bond yields overnight. Additionally, a general decline in equity markets, reflecting a risk-off sentiment, has further boosted the Greenback's safe-haven appeal against the British pound. The release of weaker Chinese macro data on Tuesday has also contributed to concerns about a fragile post-COVID recovery in the world's second-largest economy, fueling recession fears. Combined with ongoing uncertainties surrounding the federal government's borrowing limit, this has dampened investors' appetite for riskier assets. Despite mixed US Retail Sales figures, which had limited impact on the market, USD bulls remain unfazed. Market expectations are still aligned with the Federal Reserve's hawkish stance, anticipating higher interest rates for an extended period.
Short
by FOREXN1
1
EUR/USD Corrects Upwards as Market Sentiment ImprovesEUR/USD has opened the new trading week on a positive note, showing some signs of recovery after last week's losses. The currency pair managed to erase a small portion of its previous week's losses, giving hope to buyers that it could extend its correction and rally further. However, the previous week was not kind to the EUR/USD as the broad-based strength of the US Dollar amid risk aversion weighed heavily on the pair. As a result, the pair hit its lowest level in a month below 1.0850 on Friday, leaving many investors uncertain about its future direction. Early on Monday, the Euro Stoxx 50 has been trading in positive territory, and US stock index futures have also risen between 0.25% and 0.35%. This reflects a more optimistic market sentiment, which could be a good sign for the EUR/USD as well. As for the technical analysis, the next level to watch out for is the area between the 50% and 61.8% Fibonacci retracement levels, where the price may experience a pullback. The area of 1.09000 is where the 61.8% Fibonacci level is placed, making it one of the most important levels to watch out for. In conclusion, the EUR/USD is showing some promising signs of recovery after last week's losses. However, the broader market sentiment and technical indicators suggest that there could be some resistance ahead before the pair can gain any significant momentum.
by FOREXN1
30
NZD/USD Drops on Weak Chinese Data, Bearish Bias IntactDisappointing Chinese Economic Data Pushes NZD/USD Below 0.6250, Confirming Bearish Bias The NZD/USD pair experienced a significant drop below the key level of 0.6250 following the release of weaker-than-anticipated annual Retail Sales data by the National Bureau of Statistics of China. The data revealed that the economic expansion in April stood at 18.4%, falling short of the forecasted 21.0%, although it did surpass the previous release of 10.6%. Additionally, the annual Industrial Production data for April landed within the estimated range of 10.9% but exceeded the former release of 3.9%, registering a growth rate of 5.6%. This slower growth in both retail demand and industrial production suggests that the Chinese economy is making progress in the right direction following the easing of full lockdown measures. From a technical perspective, the NZD/USD pair has initiated a new bearish impulse aligned with the prevailing downtrend. This downward movement was triggered when the price reached the 38.2% Fibonacci continuation level. As a result, our bias for the NZD/USD pair remains bearish, indicating a potential further decline in the near future.
by FOREXN1
13
EUR/JPY:Overbought Conditions and Divergence -Potential PullbackEUR/JPY exhibits strong upward momentum as it recovers above the 148.00 level early in the week. However, the current price is encountering resistance at the 61.8% Fibonacci area, where an overlap between overbought conditions and divergence on the RSI suggests a potential pullback in line with the prevailing trend. Should the price surpass the A leg of the potential AB=CD pattern, it could initiate a fresh bullish impulse.
by FOREXN1
20
GBP/USD retreats ahead of BoE policy announcement - Long SetupEarly on Thursday, GBP/USD retreated below 1.2600, losing its bullish momentum after reaching a one-year high at 1.2680 on Wednesday. The upcoming Bank of England (BoE) policy announcements are now in focus, with the pair's near-term technical outlook pointing to a bearish tilt. The US Dollar (USD) came under selling pressure on Wednesday after the Consumer Price Index (CPI) data showed a rise of 4.9% YoY in April, below the market expectation of 5%. However, the cautious market sentiment did not allow GBP/USD to sustain its upward momentum. The BoE is expected to increase its key rate by 25 basis points to 4.5% in the May policy meeting, though inflation remains stubbornly high. If two external members of the Monetary Policy Committee (MPC) vote in favor of keeping the policy rate unchanged, it could be seen as a hawkish surprise, while the GBP could gain strength if the policy statement shows some members voted for a 50 bps rate increase. Revised projections will also be closely watched, and if the BoE expects inflation to fall rapidly before summer, it could signal the end of the tightening cycle, putting pressure on the GBP. If Governor Andrew Bailey leaves the door open for additional rate hikes, the GBP could regain its strength. The technical analysis shows that the price has reached the 61.8% Fibonacci level at 1.2500 inside a bullish channel, providing a good opportunity for traders to take a long position. The upcoming BoE event is likely to be the primary driver of GBP/USD's action, though the April Producer Price Index (PPI) and weekly Initial Jobless Claims data will also feature on the US economic docket later in the day.
by FOREXN1
14
AUD/USD: Global Economic Slowdown Putting Pressure on AUDOn Thursday, global economic slowdown concerns resurfaced after the release of mixed Chinese inflation figures and a weaker US labor market report. These developments have put downward pressure on the risk-sensitive Australian dollar (AUD). In contrast, the US dollar (USD) is consolidating the previous day's gains, reaching over a one-week high and drawing support from a slight increase in US Treasury bond yields. This added strength in the USD is contributing to further downward pressure on the AUD/USD pair. However, the downside for the pair seems limited for now. The uncertainty surrounding the Federal Reserve's (Fed) next policy move is preventing USD bulls from making aggressive bets. While the US CPI report released earlier this week indicated some signs of easing inflationary pressure, investors are still divided over the possibility of rate cuts later this year. This situation, combined with a generally positive tone in equity markets, is keeping a lid on further gains for the safe-haven USD and lending support to the AUD/USD pair. Moreover, the hawkish outlook of the Reserve Bank of Australia (RBA), which suggests the need for further tightening of monetary policy to ensure inflation returns to its target within a reasonable timeframe, adds a note of caution for bearish traders. Nevertheless, the AUD/USD pair is on track to end the week lower and to reverse a major part of its gains recorded over the past week or so.
Short
by FOREXN1
30
EUR/USD: Fundamental Analysis + Possible Next Target ABCDOn Thursday, the EUR/USD pair continued its downward trend, hitting a fresh weekly low of 1.0917 during London trading hours. Despite poor performance from government bond yields, the US Dollar gained ground due to a persistent gloomy sentiment. Prior to Wall Street's opening, the 10-year note yields fell 6 basis points to 3.36%, while the 2-year note dropped 6 bps to 3.83%. The Euro declined following comments from European Central Bank (ECB) official Joachim Nagel, who emphasized that the ECB will make decisions on a meeting-by-meeting basis, dismissing rumors of a September rate hike. In addition, the ECB's Consumer Expectations Survey revealed that consumer inflation expectations increased significantly in March, while expectations for economic growth over the next 12 months became slightly more negative. On the data front, Initial Jobless Claims in the United States (US) unexpectedly surged to 264K for the week ending May 5, much worse than the anticipated 245K. On a positive note, the Producer Price Index (PPI) rose 2.3% YoY in April, below the previous 2.7% and less than the 2.4% forecast. Compared to the previous month, the PPI saw a modest increase of 0.2%, surpassing market expectations. From a technical perspective, the completed AB=CD Pattern indicates that the D leg has reached the point 1.621 Extension, where the price may experience a reversal in this area, as seen in the previous AB=CD Pattern. Our target area for the next bullish move is around the upper side of the bearish channel at 1.09800, with a stop loss at 1.0855. That's our bullish idea.
by FOREXN1
7
GBP/USD Bulls in Control Ahead of US Inflation Data/BoE MeetingOn Tuesday, the Pound Sterling (GBP) rebounded above the 1.2600 level against the US Dollar (USD), following a slip in the Greenback as a result of slightly softer US Treasury bond yields. Traders are anticipating two significant releases that are expected to impact the GBP/USD over the next two days, namely the US Consumer Price Index (CPI) inflation data on Wednesday, and the Bank of England (BoE) policy meeting on Thursday. From a technical perspective, the GBP/USD is currently in a broadly bullish long-term uptrend. The old adage that "the trend is your friend" provides an advantage for long over short holders. The price on the H1 timeframe recently rebounded on the 61.8% Fibonacci level from the previous swing, and the stochastic indicator displays a divergence with oversold levels. Based on this analysis, our forecast is bullish.
Long
by FOREXN1
35
USD/CHF under pressure ahead of US inflation dataAhead of Wednesday's European session, USD/CHF struggles to rebound from intraday lows to 0.8900 amid a cautious market mood ahead of the crucial US inflation data. Despite the pre-data anxiety, there is cautious optimism surrounding the US debt ceiling and banking issues, leading to a retreat in the CHF pair. The downside pressure on the USD/CHF price is due to the recent upbeat earnings season, absence of any fresh banking fallouts, and hopes that US policymakers can avoid a likely "catastrophic" default. The short-term moves of the USD/CHF pair are restricted within a one-month-old falling wedge bullish chart formation, with a possible next bearish movement to the level of 0.8810.
by FOREXN1
25
EUR/USD Rebound Amid Dollar Pullback and OptimismThe Euro pair has recently experienced a rebound that can be attributed to multiple factors, including the broad pullback of the US Dollar prior to the release of crucial US inflation data for April. Despite some mixed feelings in the market about US default fears and banking woes, there seems to be cautious optimism among investors, which has also contributed to the Euro's resurgence. Furthermore, the relatively more hawkish comments from ECB officials in comparison to those from Fed members have caught the attention of bullish investors. From a technical perspective, the Euro pair is currently still within a Demand Zone, which is a sideways area or range where the price may rebound from the lower side of the zone and experience a new bullish impulse towards the Supply zone. Additionally, the stochastic indicator shows that the pair is in an oversold area with divergence on the H4 timeframe. This means that the price may be due for a rebound in the near future. Overall, the current state of the Euro pair is influenced by both fundamental and technical factors. The market sentiment and investor optimism, along with the comments from central bank officials, are contributing to the Euro's strength. The technical indicators also suggest that the pair may be due for a rebound, which could potentially drive the price towards the Supply zone.
Long
by FOREXN1
5
GOLD price falls on mixed US data and Fed rate hike pause hintsThe XAU/USD gold price has retreated slightly from its all-time high as bullish investors take a pause ahead of the crucial US Nonfarm Payrolls (NFP) report. The Federal Reserve's recent indication of a potential pause in its rate hike trajectory, coupled with Chairman Jerome Powell's cautious remarks, has led to a weakening of the US Dollar and an upward push on gold prices. Mixed US data on Thursday and mounting expectations of a Fed rate hike in September 2023 have further bolstered the price of gold, while concerns over potential banking crises and debt ceiling expiration continue to weigh on XAU/USD traders. From a technical perspective, the gold price experienced a significant bearish dip, testing the $2,000 mark before recovering to around $2,010. However, the release of the better-than-expected Nonfarm Payrolls report for April caused a surge in the 10-year US T-bond yield, resulting in a drop in XAU/USD. Currently, the price is situated within our zone of interest, located between the 50% and 61.8% Fibonacci levels, which are in conjunction with the previous support area. Our analysis suggests a new pullback towards the main trend, with a long position recommended following the trend in the daily timeframe.
OANDA:XAUUSD
by FOREXN1
24
GBPJPY Targets New Highs Following Bullish ImpulseGBPJPY has been maintaining its upward momentum since the start of the year, with the price surging to a seven-year high of 172.31 on the previous Tuesday. However, the price action experienced a pullback towards the previous dynamic trendline that coincided with the 61.8% Fibonacci level, finding support at around the 168.000 level. This support level led to the formation of a new bullish impulse in the price action, suggesting that the upward trend could continue. Based on this analysis, our idea is to take a bullish stance on GBPJPY, with a target price of 172.500. The bullish momentum seems to be intact, and we believe that the price action has the potential to extend its gains further in the near future.
Long
by FOREXN1
40
GBP/NZD Rebounds Support Area and Presents New Long SetupDuring the Asian Session, the currency pair GBP/NZD dropped to the level of 1.9870, which was caused by the major currency pair GBP/USD (the Cable) losing momentum due to the UK's inflation concerns. However, despite the disappointment in the UK's politics, Brexit optimism prevailed, enabling Cable buyers to regain control. On Monday, during the UK holiday, the Cable's decline from its highest levels since April 2022 was noticeable. Nonetheless, the fresh optimism surrounding the Bank of England's positive outlook, coupled with the US Dollar's inability to sustain recent gains, encouraged Pound Sterling buyers. As a result of this positive sentiment towards the Sterling, the technical analysis of the GBP/NZD pair showed a divergence on the Hourly timeframe, with the stochastic indicator indicating an oversold area following the price rebound on a strong previous support level. Based on this analysis, we suggest a new long setup for GBP/NZD.
Long
by FOREXN1
17
EUR/USD Dips Towards 1.1000 - Find Out Where it Could Go Next.During Monday's American session, the EUR/USD lost momentum and fell towards 1.1000, with the US Dollar benefiting from cautious market sentiment. The market awaits the Fed's Loan Officer Opinion Survey. Technically, the pair is in a consolidative phase and could potentially rebound from the 61.8% Fibonacci level and dynamic trendline support of the ascending channel. A support area is present between 1.09850 and 1.1000, which could be a crucial level for potential growth towards the bullish trend. A possible AB=CD pattern could also emerge in this zone, with point C as the bullish impulse and point D as the extensive leg with a target of 1.0900. Our bias is bullish, with a potential long setup. However, if the price drops below our zone of attention, the next support area will be around 1.09400-1.09500.
Long
by FOREXN1
27
EUR/JPY: Potential Long Continuation During the last trading session, the EUR/JPY exhibited a corrective movement subsequent to a pullback in the 147.500 area and appears to have initiated a new bullish impulse, with a target to revisit the price level of 151.500, touched last week, or possibly surpass it to create a new higher high. However, in the daily timeframe, the price trend remains bearish, and a short position may be a potential consideration if the price experiences a correction and drops below the 146.800 level. The RSI indicator is still exhibiting divergence, and our underlying perspective is that of a long continuation.
Long
by FOREXN1
31
EUR/USD poised for final bullish push towards 1.11/1.115 targetRecent price action in the EUR/USD suggests that the uptrend may be losing momentum, indicating a potential slowdown in its upward movement. However, it's worth noting that we should not entirely dismiss the possibility of the currency pair making one final bullish push towards our core target of 1.1100/1.1150 before any major retracements take place. In fact, recent market activity seems to have confirmed our initial analysis, as the price action yesterday experienced a retracement to the 61.8% retracement level, which was perfectly in line with our earlier forecasts. After briefly dipping to this level, the price resumed its upward movement, supporting our view that the bullish trend remains intact for now. Taking these factors into account, our overall outlook on the EUR/USD remains bullish, with a target of 1.1100 in the near future. However, we will continue to monitor any changes in market conditions and reassess our position accordingly.
by FOREXN1
13
CAD/JPY Value Surge Amidst Central Bank ContrastsDuring a prepared speech at the Toronto Region Board of Trade, Tiff Macklem, the Governor of the Bank of Canada, emphasized the central bank's unwavering commitment to restore price stability and signaled a willingness to further increase interest rates if inflation persists significantly above the 2% target. In stark contrast, Federal Reserve (Fed) Chair Jerome Powell suggested earlier this week that the central bank was nearing the terminal rate of the current tightening cycle. As a result, the CAD/JPY has exhibited an increase in value over the past week, concluding with a bullish surge at a value of 100.77, characterized by an AB=CD pattern where the first D point is anticipated to emerge at levels between 102.500 and 103.000, before a potential reversal or retracement. Our underlying perspective is firmly based on the expectation of a long continuation towards the next resistance area illustrated on the chart.
by FOREXN1
8
NZD/CAD: Bullish Reversal Expected at Key Support Area.The rising interest rates in New Zealand are posing significant challenges for the country's farming industry. Today, the NZD/CAD currency pair hit the 0.85400 resistance area but then experienced a reversal as the CAD regained some value. As per the technical analysis, the value of the currency pair is currently approaching the previous support area within a bullish channel. The combination of the 61.8% Fibonacci retracement level, the dynamic trendline of the channel, and the support area suggests that this may be an opportune moment for the price to experience a pullback in the direction of the main trend. Therefore, we are currently seeking an entry point around the support area to initiate a new long bullish impulse. This approach is supported by our analysis of the market trends and indicators, which indicate that the NZD/CAD currency pair has the potential to appreciate in the near future. Overall, while the current economic conditions in New Zealand are challenging, there are still opportunities for investors to capitalize on the market's movements and achieve profitable outcomes.
by FOREXN1
6
GOLD price volatility awaits US NFP data release. READDuring the Asian session, the price of gold (XAU/USD) has been showing signs of volatility contraction around the $2,050.00 level. However, the precious metal has been struggling to make any significant moves as investors are eagerly awaiting the release of the United States Nonfarm Payrolls (NFP) data for further direction. Recent reports have shown that weekly Initial Jobless Claims for the week ending April 28 have risen to 242K, compared to the consensus of 240K and the previous release of 229K. Despite this, the market is expected to gain more clarity after the release of the US Nonfarm Payrolls (NFP) data, which will give insight into the current state of the labor market. According to consensus forecasts, the US labor market added 179K payrolls in April, lower than the former addition of 236K. However, the data that is likely to draw the attention of investors the most is the Average Hourly Earnings data. While the market is anticipating steady earnings numbers, a better-than-expected print could potentially reignite fears of a recovery in inflationary pressures. From a technical standpoint, our analysis shows that the price of gold may experience a retracement, with the deepest level of pullback potentially occurring at the 50% and 61.8% Fibonacci levels in confluence with a support area. This could present an opportunity to buy gold at a discount. However, it's worth noting that the metal's value may only pull back to the 38.2% Fibo level instead of going deeper to the area of our attention.
OANDA:XAUUSD
by FOREXN1
17
GBP/USD Bullish as Bank of England Plans Interest Rate HikeThe GBP/USD is striving to maintain its position above 1.2600 as the Bank of England plans to continue raising interest rates to combat inflation in the double digits. Meanwhile, the Federal Reserve has confirmed that any future policy decisions will be based on the latest data available. The GBP/USD has recently broken out of an upward-sloping channel, indicating a strong bullish trend. From a technical perspective, today's trading session has seen the GBP/USD break out of a consolidation area with a new bullish impulse, supporting our idea for a quick long position in the direction of the prevailing uptrend.
by FOREXN1
4