• Firms reported that their output prices rose by an average annual rate of 5.4% in the three months to February (down from 5.6% previously)
• Year-ahead own-price inflation was expected to be 4.3% in the three months to February (unchanged)
• Output price inflation is expected to decline by 1.1% over the next 12 months
• One-year ahead CPI inflation expectations declined to 3.3% (down from 3.4% previously)
• Three-year ahead CPI inflation expectations fell to 2.8% (down from 2.9% previously)
• Expected year-ahead wage growth seen at 5.2% on a three-month-moving-average basis (unchanged)
• Annual wage growth fell to 6.7% in the three months to February (down from 6.8% previously)

Looking at it as a whole, it just reflects some light moderation in price pressures. The good news at least is that prices aren’t really intensifying on the business end. However, how that translates to consumer prices at the end of the day is another debate really. It’s much easier said than done as companies have to watch out for their bottom line. Greed much.

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

Yesterday,
the S&P 500 finished the day negative as some weak US data started to weigh
a bit on sentiment. The ISM PMIs recently missed expectations with notably the
employment indexes showing contraction. The ADP
yesterday missed forecasts and the Job
Openings were lower than expected with negative revisions to the prior figures.
Moreover, we had Fed Chair
Powell testifying to Congress, but he basically reaffirmed their patient
approach stressing that the timing for rate cuts will be determined by the
incoming data.

S&P 500 Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the S&P 500
bounced around the trendline where we
had also the confluence with the
red 21 moving average and the
previous resistance turned support. This is
where the buyers stepped in with a defined risk below the trendline to position
for a rally into new highs. The sellers, on the other hand, will want to see
the price breaking lower to invalidate the bullish setup and position for a
drop into the next support at 4946.

S&P 500 Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we
had also the confluence of the 50% Fibonacci
retracement level at the 5048 support. The divergence with
the MACD has
been going on for a long time and it’s generally a sign of weakening momentum
often followed by pullbacks or reversals. In this case, it’s been signalling
pullbacks to the previous swing levels where we continuously found dip-buyers.
A break below the trendline would confirm a reversal and we could even see a
selloff into the 4700 next.

S&P 500 Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
latest leg higher diverged with the MACD and led to a pullback into the support
zone around the 5048 level. The buyers piled in with a defined risk below the
trendline to target new highs. If the price were to fall back into the support,
we can expect the buyers to defend the level again as a break below it would
likely trigger a selloff into new lows.

Upcoming Events

Today we get the latest US Jobless Claims figures,
while tomorrow we conclude the week with the US NFP report.

This article was written by FL Contributors at www.forexlive.com.

GBP

• The BoE left interest rates unchanged as expected at the last meeting
  removing the tightening bias but reaffirming that they will keep rates high for
  sufficiently long to return to the 2% target.
• The employment report beat expectations across the board
  with a positive revision to the December’s negative payroll figure.
• The UK CPI missed expectations across the board but with
  Services inflation remaining sticky, which continues to support the BoE’s
  patient stance.
• The latest UK PMIs improved from the prior month with the
  Services PMI beating expectations and the Manufacturing PMI missing.
• The market expects the first rate
  cut in June.

JPY

• The BoJ kept its monetary policy unchanged as expected at the last meeting
  with interest rates at -0.10% and the 10 year JGB yield target at 0% with 1% as
  a reference cap.
• The Japanese CPI beat expectations although all
  measures eased further from the prior readings.
• The latest Unemployment Rate remained unchanged hovering around
  cycle lows.
• The Japanese PMIs improved for both the Manufacturing
  and Services measures although the former remains in contractionary territory.
• The Japanese wage data missed expectations although there
  was a pick up from the prior reading.
• The Tokyo CPI, which is seen as a leading
  indicator for National CPI, came in line with expectations.
• The market expects the BoJ to hike
  rates in Q2.

GBPJPY Technical Analysis –
Daily Timeframe

On the daily chart, we can see that GBPJPY recently
couldn’t break above the high on the second try. We can also notice that the
price has been diverging with the
MACD for
quite some time. This is generally a sign of weakening momentum often followed
by pullbacks or reversals. In this case, the buyers leant on the red 21 moving average to keep
pushing into the high targeting a breakout. The sellers, on the other hand,
will need the price to break below the moving average to turn the trend around
and start targeting the 185.21 level.

GBPJPY Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we have a strong
support zone around the 190.35 level where we can also find the confluence with red
21 moving average and the 38.2% Fibonacci retracement level. This
morning we got a spike to the downside caused by a report saying
that some BoJ policymakers will likely say at the upcoming meeting that lifting
negative interest rates will be reasonable. Nevertheless, this is where we can
expect the buyers to step in with a defined risk below the level to position
for a break above the cycle high with a better risk to reward setup. The
sellers, on the other hand, will want to see the price breaking lower again to
position for a drop into the 186.67 level.

GBPJPY Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the bullish setup around the 190.35 level. If the price breaks above
the recent swing low at 190.67, then we can expect the buyers to increase the
bullish bets as it would be a confirmation for further higher highs to follow.

Upcoming Events

Today we have the US ADP, the US Job Openings and
the Fed Chair Powell speaking. Tomorrow, we get the latest US Jobless Claims
figures, while on Friday we conclude the week with the US NFP report.

This article was written by FL Contributors at www.forexlive.com.

EUR/USD strengthened during the European session as the USD lost ground after lower than expected ISM data. The pair is heading towards the 1.0915 level of resistance.

Powell will likely reiterate in his Congress testimony today that there’s no rush for the Fed to cut rates and more evidence is needed to confirm that the downward inflation trend is persistent. The market has already accounted for this and will not react unless there’s a surprise.

As such, a bigger focus will be on tomorrow’s ECB meeting. The market expects rate cuts to begin in June, but analysts anticipate that the ECB will have a dovish tone. If confirmed, EUR/USD will lose strength.

AUD/USD strengthened as well during the European session despite mixed GDP data from Australia and is currently trading near the 0.6520 support level.

NZD/USD lacks clear direction and consolidates at 0.6100.

USD/CAD is awaiting the BoC monetary policy announcement today and the labor market data on Friday which could influence the pair’s direction. A special attention for today’s meeting will be on whether the BoC hints at rate cuts. If so, the CAD will soften.

USD/JPY dropped sharply after a report that some BoJ policymakers are considering a first rate hike in March, but didn’t break the 149.30 level of support. The fact that officials have differing views on rate hike timing didn’t help the pair.

This article was written by Gina Constantin at www.forexlive.com.

Well, it was inevitable after Trump dominated the primary election on the Republican end. She managed to snag Vermont from Trump but that’s about it really. That means we are set to see this showdown once again:

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

The March poll of 40 foreign exchange analysts shows that the median forecast was for USD/CAD to fall to 1.34 in three months‘ time. In a year’s time, the pair is expected to fall to 1.30 – matching the estimate in the February poll. The expected drop comes as some analysts are forecasting a broader decline in the US dollar this year.

„The gradual decline in USD/CAD certainly in part reflects a slowing US economy and the Fed embarking on a rate cutting cycle. We also assume no hard landing and if risk remains broadly favourable this year that should also benefit CAD.“ — MUFG global markets EMEA head of research, Derek Halpenny

In case you missed it, Adam also had some insights on the loonie at the end of last month: Video: I’ve never been so bearish on the Canadian dollar

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

USD

• The Fed left interest rates unchanged as
  expected at the last meeting and dropped the tightening bias in the statement.
• The US PCE came
  in line with expectations.
• The US Jobless Claims missed
  expectations although the data is still in the recent ranges.
• The latest US ISM
  Manufacturing PMI missed expectations by a big margin
  remaining in contraction with the US ISM Services
  PMI
  following suit but holding on in expansion.
• The US Consumer
  Confidence missed expectations across the board.
• The market expects the first rate cut in June.

NZD

• The RBNZ kept its official cash rate
  unchanged dropping
  the tightening bias and stating that the OCR will need to remain at restrictive
  level for a sustained period.
• The latest New Zealand inflation data printed in line with expectations
  supporting the RBNZ’s patient stance.
• The labour market report beat expectations across the
  board with lower than expected unemployment rate and higher wage growth.
• The Manufacturing PMI improved in January remaining in
  contraction while the Services PMI jumped back into expansion.
• The market expects the first cut in
  August.

NZDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that NZDUSD has sold
off aggressively following the RBNZ rate decision last week where it kept rates
unchanged and dropped the tightening bias. The price is now consolidating
around the key support zone.
This is where the buyers should step in with a defined risk below the support
to position for a rally back into the 0.6219 level. The sellers, on the other
hand, will want to see the price breaking lower to increase the bearish bets
into the next support at 0.5870.

NZDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see the consolidation
between the key support zone and the 0.6112 resistance. We can also notice that
we have a divergence with the
MACD which is
generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, if the price were to break to the upside the reversal
would be confirmed, and the buyers would pile in more aggressively to extend
the rally into the highs. The sellers, on the other hand, will likely lean on
the resistance to position for a break below the support with a great risk to
reward setup.

NZDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent rangebound price action. There’s not much else to do here
other than waiting for the key breakouts and go with the flow. Watch out for
the data and the Fed Chair Powell today.

Upcoming Events

Today we have the US ADP, the US Job Openings and
the Fed Chair Powell speaking. Tomorrow, we get the latest US Jobless Claims
figures, while on Friday we conclude the week with the US NFP report.

This article was written by FL Contributors at www.forexlive.com.

The decisions taken in China reflected limited changes to its main targets as they were largely in line with expectations.

China estimates that its GDP for this year will grow around 5%, while the inflation target will be around 3%. The targeted deficit is 3% of GDP and the jobless rate should be 5.5%. According to Bloomberg, China aims to create over 12 million new urban jobs.

Overall those targets are optimistic and analysts argue they won’t be easy to achieve.

The top priorities remain tech innovation and upgrading certain industries, with some examples being hydrogen power, new materials, drug research and production, commercial aviation and more. As a market reaction Chinese stocks in Hong Kong dropped as investors remain sceptical of the government’s growth target.

This article was written by Gina Constantin at www.forexlive.com.

Yesterday,
the Nasdaq Composite retreated a bit after the strong rally following the miss
in the ISM
Manufacturing PMI last Friday. There might be some profit taking
going on as we finally made a new all-time high and we have lots of risk events
ahead with the US labour market data and Fed Chair Powell testifying to
Congress. The path of least resistance remains to the upside until we either
see growth deteriorating or the economic data makes the market to expect the
Fed to make a U-turn on rate cuts.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite extended the rally into a new all-time high last Friday. The price
started to retreat yesterday as the sellers stepped in with a defined risk
above the high to position for a drop into the key trendline
targeting a break below it. The buyers, on the other hand, will want to wait
for the price to reach the trendline to position for a rally into new highs
with a better risk to reward setup.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that
the price has been diverging with
the MACD for a
long time. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. The pullbacks in this case resolved all into the
trendline, so we can expect the price to do the same in the next few days. We
can also notice that we might have formed a rising wedge, so it
will be important for the buyers to avoid a break below the bottom trendline because
it could trigger a selloff into the base of the wedge at 14477.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
have now a resistance turned
support around the 16130 level where we have also the 50% Fibonacci
retracement level and the red 21 moving average for confluence. The
buyers might want to split their position in half between the support and the
trendline as the price can bounce on either level before continuing higher. The
sellers, on the other hand, will want to see the price breaking below the
bottom trendline to invalidate the bullish setup and increase the bearish bets
into new lows.

Upcoming
Events

This week we have lots of important events on the agenda
with the release of the US labour market data and the Fed Chair Powell
testifying to Congress. We begin today with the US ISM Services PMI. Tomorrow,
we have the US ADP, the US Job Openings and the Fed Chair Powell speaking. On
Thursday, we get the latest US Jobless Claims figures, while on Friday we
conclude the week with the US NFP report.

This article was written by FL Contributors at www.forexlive.com.

Why gold prices are gleaming brighter lately 🌟

It seems the the crypto boyz are mooning crypto meme coins, the Nasdaq is making another all time high every month, Nvidia and other AI stocks are faking out the bears again, and rallying… again. So why the heck is gold rising, too?

In an intriguing twist of financial markets this past week, gold prices have not just inched but leaped forward, drawing attention from investors and traders worldwide. This movement is far from arbitrary; it’s rooted in a tapestry of factors that together weave a compelling narrative for gold’s current allure. Let’s break down the key drivers behind this golden rally:

1. Fed’s interest rate dance 💃: The whispers of potential rate cuts by the Federal Reserve have set the stage. With the U.S. economic indicators not performing their best dance moves, speculation is rife about a softer monetary policy stance. In this ballet of finance, gold shines when the interest rates dip, offering a spotlight performance as yields on traditional investments dim.

2. A safe haven in stormy weather 🌩️: Amid the geopolitical thunderstorms, from ongoing conflicts to broader uncertainties, gold stands as a steadfast shelter. Its reputation as a sanctuary asset is reinforced, attracting investors seeking calm within the storm.

3. Central banks‘ gold rush 🏦: A notable narrative is the robust buying spree by central banks, particularly in Asia. This strategic accumulation reflects a quest for financial security and diversification, bolstering gold’s demand and price.

4. India’s season of gold 💍: The narrative takes a cultural twist with India’s peak wedding season on the horizon. Gold, revered for its auspiciousness in celebrations and traditions, sees a spike in demand, particularly in jewelry, adding another layer of demand-induced price support.

5. Balancing crypto risky volatility with gold’s preceived stability ⚖️: In the digital realm, the crypto markets continue their wild ride, marked by volatility and regulatory crosshairs. This uncertainty casts gold in a pivotal role as a hedge, offering a counterbalance to the high-risk, high-reward nature of cryptocurrencies. Investors, navigating the tumultuous seas of digital assets, increasingly view gold as an anchor, tempering the speculative waves with its enduring value.

The golden path forward 🛤️

Follow ForexLive.com to help you navigate and understand the markets. Always invest and trade at your own risk. 🚀🌐💡

This article was written by Itai Levitan at www.forexlive.com.