<ul><li>S&amp;P 500 futures -0.4%</li><li>Nasdaq futures -0.6%</li><li>Dow futures -0.2%</li><li>Eurostoxx -0.7%</li><li>Germany DAX -0.6%</li><li>France CAC 40 -0.6%</li><li>UK FTSE -0.8%</li></ul><p style=““ class=“text-align-justify“>There’s not much in terms of catalysts as broader markets are waiting on the US jobs report tomorrow before firming up any convictions.</p><p style=““ class=“text-align-justify“>That said, bond yields are holding steady during the session so far. 10-year Treasury yields are sitting back close to the 4% threshold, seen at 3.995% currently. Meanwhile, 2-year yields while slightly lower are still sitting above the 5% mark – now seen at 5.038%.</p><p style=““ class=“text-align-justify“>Adding to that, bond yields in Europe are also looking perky and looking to fresh cycle highs. 2-year German bond yields are up 1.2 bps to 3.345%, hovering at its highest levels since October 2008.</p><p style=““ class=“text-align-justify“>However, when you look over to the major currencies space, it’s hard to find a matching theme. The dollar is lower across the board with USD/JPY leading the drop, down 0.8% to 136.20 at the moment.</p><p style=““ class=“text-align-justify“>The non-farm payrolls data can’t come soon enough.</p>

This article was written by Justin Low at www.forexlive.com.

<p>On the daily chart below, we can
see that after bouncing from the key <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>support</a> level at 32684, the price
rallied towards the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>resistance</a> at 33538. The sellers leant on
that level and the red long period <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/“>moving
average</a> before the big selloff caused by <a target=“_blank“ href=“https://www.forexlive.com/news/ka-powell-20230308/“>Fed
Chair Powell’s</a> comments on a possible 50bps hike at the March
meeting and a higher terminal rate. </p><p>The price is now again at the key
support level and the breakout will come down to the NFP report tomorrow. If
the data beats expectations, we should expect the breakout and a bigger selloff
with the first target being at 31800. In case the data misses forecast, we
should expect another rally probably towards the resistance at 33538. </p><p>On the 4 hour chart below, we can
see more closely how the rally stalled at the resistance at 33538 where we had
also the daily long period moving average and the 50% <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/“>Fibonacci
retracement</a> level of the entire downward move. </p><p>That was a strong level that
buyers couldn’t break and folded as soon as Powell sounded more hawkish than
expected. The moving averages are now crossed to the downside and will act as
resistance in case we get a pullback before the data. </p><p>In the 1 hour chart below, we can
see that he price <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/“>diverged</a> with the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/“>MACD</a> right at the support and we got
a pullback. This should be a sign of uncertainty before the data release. The
pullback may extend to the 32937 level where we can also find the 38.2%
Fibonacci retracement level just above. </p><p>That’s going to be a good resistance
zone for the sellers and one that buyers will need to break decisively if they
want to target the resistance at 33538. Anyway, the data will guide the market,
so watch out for tomorrow. </p>

This article was written by ForexLive at www.forexlive.com.

<ul><li>Prior -5.7%</li><li>Market index 201.5 vs 188.5 prior</li><li>Purchase index 154.4 vs 138.8 prior</li><li>Refinance index 437.9 vs 444.0 prior</li><li>30-year mortgage rate 6.79% vs 6.71% prior</li></ul>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>After the Powell-induced volatility yesterday, markets are adopting a calmer approach so far today. Looking at the bond market first, 2-year yields in the US are up 3 bps to 5.040% while 10-year yields are flat at 3.972% currently. That is seeing equities fare slightly better with S&amp;P 500 futures up 8 points, or 0.2%, while European indices are little changed at the moment.</p><p style=““ class=“text-align-justify“>Meanwhile, the dollar is trading more mixed across the board with light changes for the most part. I’ve summed up the technical predicaments for dollar pairs in my earlier posts below:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurusd-nears-a-test-of-key-support-level-as-dollar-stays-poised-20230308/“ target=“_blank“ rel=“follow“>EUR/USD nears a test of key support level as dollar stays poised</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/usdjpy-looks-for-a-more-meaningful-upside-break-on-higher-bond-yields-20230308/“ target=“_blank“ rel=“follow“>USD/JPY looks for a more meaningful upside break on higher bond yields</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/gbpusd-downside-in-focus-after-break-of-january-lows-20230308/“ target=“_blank“ rel=“follow“>GBP/USD downside in focus after break of January lows</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/usdchf-looks-for-a-bit-more-of-a-pullback-for-now-20230308/“ target=“_blank“ rel=“follow“>USD/CHF looks for a bit more of a pullback for now</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/usdcad-comes-up-for-some-air-boc-in-focus-later-today-20230308/“ target=“_blank“ rel=“follow“>USD/CAD comes up for some air, BOC in focus later today</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/audusd-in-troubled-waters-after-double-whammy-yesterday-20230308/“ target=“_blank“ rel=“follow“>AUD/USD in troubled waters after double whammy yesterday</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/nzdusd-downside-case-in-focus-after-yesterdays-plunge-lower-20230308/“ target=“_blank“ rel=“follow“>NZD/USD downside case in focus after yesterday’s plunge lower</a></li></ul><p style=““ class=“text-align-justify“>That being said, despite the calmer mood now, we may see things kick into gear later on once Wall Street steps into the fray and when we get to the US ADP employment data. It’s all about <a target=“_blank“ href=“https://www.forexlive.com/news/the-landmines-ahead-of-the-fomc-policy-meeting-decision-later-this-month-20230308/“ target=“_blank“ rel=“follow“>navigating through the field of landmines</a> now.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>Much like AUD/USD, there is a relatively mild bounce in the pair today but it doesn’t take away from the notable technical development that we saw yesterday. The pair not only broke back below both its 100 (red line) and 200-day (blue line) moving averages but also took out the 38.2 Fib retracement level of its swing higher since October, seen at 0.6145.</p><p style=““ class=“text-align-justify“>The latter helped to arrest the declines at the end of February but now with those key levels out of the way, sellers are in control and are looking poised to try to establish a further downside leg in the pair.</p><p style=““ class=“text-align-justify“>The next key area of support will come from the 0.6000 mark alongside the 50.0 Fib retracement level at 0.6025.</p><p style=““ class=“text-align-justify“>It’s now all about dollar sentiment and as highlighted with other dollar pairs earlier, a lot will rest on the <a target=“_blank“ href=“https://www.forexlive.com/news/the-landmines-ahead-of-the-fomc-policy-meeting-decision-later-this-month-20230308/“ target=“_blank“ rel=“follow“>upcoming landmines</a> before the FOMC policy meeting decision on 22 March. And we won’t have to wait long as there will be the US ADP employment report later today, which will act as a teaser for the US non-farm payrolls on Friday.</p>

This article was written by Justin Low at www.forexlive.com.

<p>On the daily chart below, we can
see that after falling for basically the whole February, gold had a nice bounce
at the start of March. The pullback brought the price back to the red long
period <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/“>moving
average</a> where the sellers started to pile in. </p><p>Gold is sensitive to real yields,
and these have been rising lately as the market is pricing a more hawkish Fed
given that the US data started to come in hot since February onwards. </p><p>Yesterday, <a target=“_blank“ href=“https://www.forexlive.com/news/ka-powell-20230308/“>Fed
Chair Powell</a> opened the door for a 50bps hike and a higher
terminal rate which caused a selloff in gold as the market is now pricing a
higher chance of the more aggressive hike at the March meeting. </p><p>The market will now focus on the <a target=“_blank“ href=“https://www.forexlive.com/EconomicCalendar“>NFP and CPI report</a> that are coming next and beats
in the data should send the price even lower, while misses should give us a
strong rally, possibly towards the 1900 level. </p><p>On the 4 hour chart below, we can
see that the buyers couldn’t sustain the breakout of the 1860 <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>resistance</a> zone and gave up to the sellers
resulting in a fakeout. The big selloff you see on the chart was some
positioning into Powell’s testimony and then more selling as Powell sounded
more hawkish than expected. </p><p>The price has overstretched a bit
yesterday as depicted by the distance between the price and the blue short
period moving average. Generally, we can see some consolidation or a pullback
before the next push into the original direction. The most likely area for a
pullback would be the resistance zone at 1825. </p><p>On the 1 hour chart below, we can
see more closely the possible resistance for a pullback. The 1825 area has the
red long period moving average and as you can see looking left, this level has
been respected by the market several times. </p><p>That’s where we will most likely
see the sellers piling in again trading into the NFP. In case, the NFP misses
expectations, the buyers will have the conviction to break the resistance and
probably extend the rally towards the 1860 level. </p>

This article was written by ForexLive at www.forexlive.com.

<p>On the daily chart below, we can
see that the buyers are struggling breaking decisively above the 0.94 handle.
The falling channel was <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/“>diverging</a> with the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/“>MACD</a> and this generally leads to the
price rallying back to the top of the channel once there’s a breakout. So,
technically the buyers will target the 0.96 handle and if the US data keeps
coming in hot, then it’s basically assured that we will get there. </p><p>Yesterday, <a target=“_blank“ href=“https://www.forexlive.com/news/ka-powell-20230308/“>Fed
Chair Powell</a> opened the door for a 50bps hike and a higher
terminal rate if the data remains strong which prompted the market to buy the
USD aggressively. The next big event now is the <a target=“_blank“ href=“https://www.forexlive.com/EconomicCalendar“>NFP report on Friday</a> and if we get a beat, then we
will most likely see the USD bid across the board, while a miss would cause
some strong weakness in the greenback. </p><p>On the 4 hour chart below, we can
see more closely the struggle the buyers are finding extending past the 0.94
handle. We got quite a big pullback on the first try breaking out of that <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>resistance</a>, but the buyers defended the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>support</a> at 0.9287. </p><p>Given that the market is now
pricing a higher chance of a 50bps hike, a higher terminal rate and chances of
good US data, we should expect the buyers to remain in control and keep bidding
the USD to new higher highs. </p><p>On the 1 hour chart below, we can
see where we would most likely find buyers in case the price pulls back before
pushing up again. The area between 0.9400 and 0.9380 has some technical
support. The 0.94 handle could be a <a target=“_blank“ href=“https://www.forexlive.com/Education/using-psychological-price-levels-for-your-trading-20220414/“>psychological
support</a> being a round number and the 38.2% <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/“>Fibonacci
retracement</a> level would bring the market back into equilibrium
from overstretched highs after yesterday’s huge rally. </p>

This article was written by ForexLive at www.forexlive.com.

<ul><li>10-year Treasury yields down 5.5 bps to 3.928%</li><li>10-year German bond yields down 6.2 bps to 2.665%</li><li>10-year Italian bond yields down 12.3 bps to 4.450%</li></ul><p style=““ class=“text-align-justify“>The drop in yields is at least helping out equities a little, with S&P 500 futures seen up 9 points, or 0.2%, currently. Meanwhile, European indices are also up slightly by around 0.1% to 0.2% across the board. That said, the early moves now may not mean much as market players are all waiting on Fed chair Powell’s remarks later in the day.</p><p style=““ class=“text-align-justify“>Looking at FX, there isn’t much change among major currencies with exception to the aussie as noted <a target=“_blank“ href=“https://www.forexlive.com/news/aussie-dribbles-lower-in-european-morning-trade-20230307/“ target=“_blank“ rel=“follow“>here</a> – owing to the RBA’s less hawkish policy decision earlier today.</p><p style=““ class=“text-align-justify“>As a reminder once again, just be wary that we may see <a target=“_blank“ href=“https://www.forexlive.com/news/icymi-the-text-of-powells-testimony-may-be-released-ahead-of-his-appearance-20230307/“ target=“_blank“ rel=“follow“>the text of Powell’s testimony be released ahead of time</a>.</p><p>Is it time for my speech yet?</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>In the article, Timiraos says that „Powell is likely to caution on Capitol Hill that strong economic activity this year could lead U.S. central bank officials to raise interest rates more than they expected to combat high inflation“. Besides that, the rest is just some backdrop reading and you can check it out <a target=“_blank“ href=“https://www.wsj.com/articles/jerome-powell-to-testify-to-congress-on-outlook-for-rates-inflation-e4e7f1e3?mod=latest_headlines“ target=“_blank“ rel=“nofollow“>here</a> (may be gated).</p><p style=““ class=“text-align-justify“>As a reminder, we might be getting the text to Powell’s testimony a little earlier than his scheduled appearance. Keep an eye out for something between 1200 GMT to 1400 GMT.</p>

This article was written by Justin Low at www.forexlive.com.

<p>On the daily chart below, we can
see that the price is trending downwards in a clean way. The blue short period <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/“>moving
average</a> has been acting as resistance which is a sign of a strong selling
momentum. The sellers will have the red long period moving average and the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/“>trendline</a> as resistance in case the price
pulls back. </p><p>As of now, the sellers are in
control and it looks like we will have a test of the 0.6629 <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>support</a> soon. The RBA today delivered a <a target=“_blank“ href=“https://www.forexlive.com/news/aussie-lower-after-rba-offers-subtle-change-to-policy-guidance-20230307/“>dovish
hike</a> which should give the US Dollar another tailwind as the market looks
for a higher terminal rate for the Fed. In case key US <a target=“_blank“ href=“https://www.forexlive.com/EconomicCalendar“>economic data</a> like NFP and CPI comes out soft
though, we should see AUD/USD rallying as the market would reprice lower future
interest rate expectations. </p><p>On the 4 hour chart below, we can
see that the price has been ranging for about a week but today’s RBA monetary
policy announcement gave the sellers the catalyst to break out of the range. </p><p>The sellers may not be out of the
woods yet though as today we will have <a target=“_blank“ href=“https://www.forexlive.com/news/icymi-the-text-of-powells-testimony-may-be-released-ahead-of-his-appearance-20230307/“>Fed
Chair Powell testimony</a> and it’s expected that if he sounds dovish, the US
Dollar will lose some ground so we may see the price getting back into the
range, and in case he sounds hawkish, we should see the US Dollar getting even
stronger. </p><p>On the 1 hour chart below, we can
see more closely the breakout of the range caused by the RBA catalyst. The
buyers will need the price to get back into the range to hope for another run
into the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>resistance</a> at 0.6781 which will need the
support from the fundamentals. </p><p>The sellers may wait for a retest
of the broken support now turned resistance before piling in again or more
probably wait for the Fed Chair Powell testimony later today. </p>

This article was written by ForexLive at www.forexlive.com.