Market Update by Solidecn.com

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Gold

During today's session gold price bounced off recent lows above the $1,800 an ounce mark, a level not seen since December 2022. Upward move gained steam after publication of latest Conference Board consumer confidence figures. Price is currently approaching crucial support at $1830, which is marked with previous price reactions, upper limit of local 1:1 structure and 38.2% Fibonacci retracement of the upward wave started in March 2020. Should break lower occur, upward move may accelerate towards the key resistance zone between $1868 - 1875 an ounce. On the other hand, if sellers manage to halt declines around $1830 level, another downward impulse may be launched towards psychological support at $1800.

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EURUSD

Flash CPI reports for February from France and Spain were released today at 7:45 am GMT and 8:00 am GMT, respectively. Expectations were for a slight acceleration in French headline price growth and a slight slowdown in Spanish price growth. French data turned out to be higher-than-expected and provided some support for EUR while pushing European indices, like DE30, slightly lower. Spanish reading further magnified those moves as it showed price growth accelerating in spite of an expected slowdown.

France

• Annual: 6.2% YoY vs 6.1% YoY expected (6.0% YoY previously)
• Monthly: +0.9% MoM vs +0.7% MoM expected (+0.4% MoM previously)

Spain

• Annual: 6.1% YoY vs 5.7% YoY expected (5.9% YoY previously)
• Monthly: +1.0% MoM vs +0.9% MoM expected (-0.4% MoM previously)

Those releases offer an important insight but, as far as market reaction is concerned, the best is yet to come. German CPI reading for February, the most closely watched one in Europe, will be released tomorrow at 1:00 pm GMT and is expected to show a slowdown from 8.7 to 8.5% YoY. Release of ECB minutes scheduled for Thursday, 12:30 pm GMT also has a scope to move EUR.

EURUSD



EURUSD caught a bid following French and Spanish CPI data and retested the 1.06 mark. However, no decisive break higher was made yet.

DE30



Equities, including German DE30, took after today's CPI data. DE30 is making a test of the lower limit of the ongoing short-term trading range in the 15,300 pts area.

[Solid ECN]

USDCHF Rebounds from the Resistance

USDCHF pair bounced downwards clearly after testing the bullish channel’s resistance that appears on the chart, to approach the key support 0.9316, noticing that stochastic got rid of its negative momentum to show oversold signals now, while the EMA50 provides positive support to the price.



Therefore, we believe that the chances valid to resume the correctional bullish trend, which targets 0.9475 as a next station, reminding you that the continuation of the bullish wave requires holding above 0.9316.

[Solid ECN]

EURUSD

EUR appreciated strongly against USD during the European session, however bullish momentum lost its steam in the evening as markets digested fresh comments from ECB's Vujcic.

• Markets are right to price in 50 bps for the March meeting.
• Rates are about to enter restrictive territory.
• Labor markets are likely to remain strong.
• We must persevere as long as core inflation remains high.
• We must consider both headline and core inflation
• Headline inflation is set to fall.
• The role of the ECB is not to determine where the terminal rate should be.

The market is pricing in a 44% chance of 75 bps at the ECB March meeting.


EURUSD retreated sharply from session high at 1.0620, erasing a large chunk of today's gains. Nevertheless as long as the pair sits above local support at 1.0580 another upward move may be launched.

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Bitcoin

Cryptocurrencies at the start of the week are trying to make up for declines from the weekend, when Bitcoin retreated below $23,000 on a wave of disappointing for bulls PCE US inflation data. But today Wall Street indices rise again.

Despite media reports of a possible global ban on cryptocurrencies being analyzed by the International Monetary Fund and the Financial Stability Board, former World Bank president and IMF chief Georgieva indicated that rather than resorting to a global ban, regulators will work to create an appropriate regulatory framework, taking into account the popularity of cryptocurrencies in emerging economies. In the wake of a softening extreme regulatory spectrum and a rebound on exchange floors, with Bitcoin trading near $23,800, other cryptocurrencies are also trying to rebound.




List of the most gaining cryptocurrencies. Leading the way are the intensely oversold NEO, DYDX and Maker on Friday.




Cryptocurrency-based investment products saw outflows last week, after investors moved funds into funds betting on Bitcoin declines.

• Positive U.S. economic data and the prospect of more Fed rate hikes dampened risk demand, weighing on cryptocurrencies. Funds betting on BTC declines saw inflows totaling $10 million in the week ended February 24, according to CoinShares, compared to an outflow of $12 million from funds betting on a rise in the BTC price (the third weekly decline in a row). Positive fund inflows were registered by CoinShares for Polygon, Solana and Cardano with slightly negative ones for Ethereum.

The CoinShares report highlighted the most important short-term risks for the industry are the controversy over regulations planned for implementation in 2023, the position of the SEC - whose head Gary Gensler says that of all cryptocurrencies, only Bitcoin is a 'digital commodity' and may not fall under its jurisdiction, and investor sensitivity to macroeconomic data. , which have recently disappointed bulls by casting doubt on the disinflationary trend.



itcoin, M30 interval. The major cryptocurrency has broken above the SMA200 average and is struggling for a sustained breakout above the 38.2 Fibonacci retracement at $23,800, which could reopen the way to $25,000.

[Solid ECN]

GBPUSD

UK Prime Minister Rishi Sunak met at Windsor with European Commission President Ursula von der Leyen today to discuss Brexit. more precisely, to discuss the so-called Northern Ireland protocol. This is one of the final outstanding issues preventing the Brexit chapter from closing. Rishi Sunak is set to deliver a statement on discussions to the UK Chamber of Commons at 6:30 pm GMT. However, there is a lot of confusion around the outcome of talks.

Steve Baker, British Minister of State for Northern Ireland and a Brexit hardliner, asked by reporters as he left Downing Street 10 said that Prime Minister Sunak was at a cusp of securing a fantastic deal. Later, the media reported that Democratic Unionist Party (DUP) of Northern Ireland liked the deal and is ready to accept it soon. However, this optimism was put under question later on when DUP leader Donaldson told reporters that he is neither positive, nor negative on the outcome of talks and that his party will need to take time to analyze the proposal and how it answers DUP's concerns.



Having said that, there is a lot of uncertainty and the statement from Sunak at 8:30 pm GMT today may be simply an update rather than an announcement. Nevertheless, GBP has traded higher throughout the day and is the best performing G10 currency at press time. Taking a look at GBPUSD chart at D1 interval, we can see that the pair bounced off the support zone marked with 38.2% retracement of the downward move launched in mid-2021. However, it should be said that a bulk of this move was driven by USD weakening following disappointing durable orders data for January at 1:30 pm GMT.

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NATGAS

US natural gas prices once again launch a new week with an upward move. NATGAS continues upward movement launched on Friday. This move was triggered by forecasts for colder weather in key US heating regions over the next two weeks and therefore higher demand for natural gas.



US natural gas prices dropped around 70% between mid-December 2022 and mid-February 2023. While there were some upward corrections during this downward impulse, the one we are observing currently deserves a note. Taking a look at NATGAS chart at H4 interval, we can see that price broke above the 50-period Exponential Moving Average at the end of the previous week and it was the first such breakout since mid-December. This may hint that a large upward correction may be on the cards. A break above the upper limit of a market geometry at 2.816 would confirm bullish momentum.

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NZDCAD

The NZDCAD pair continued to provide correctional bearish tracs due to facing strong negative pressures caused by stochastic crawl below 50 level, to suffer additional losses and settle near 0.8360 level.



We notice the price consolidation within the bullish track that depends on 0.8390 level forming strong support line that allows us to wait to gather the additional positive momentum to manage to start activating the bullish track and expect to rally towards 0.8430, followed by attempting to breach 0.8485 obstacle in order to ease the mission of reaching additional stations in the upcoming period.

[kimli43]

Fundamental Analysis: Professional traders also use fundamental analysis to evaluate the economic and political factors that can impact the forex market. They monitor news and economic indicators to gauge the health of the economy, inflation rates, and interest rates, among other factors.

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USDJPY

• Wall Street indices had a volatile session yesterday but have ultimately finished trading with decent gains. S&P 500 gained 0.53%, Dow Jones added 0.33%, Nasdaq moved 0.72% higher and Russell 2000 jumped 0.71%
• Indices from Asia-Pacific traded mixed today. Nikkei gained 1.3%, S&P/ASX 200 moved 0.3% higher, Kospi dropped 0.6% and Nifty 50 traded flat. Indices from China traded 0.5-1.4% lower
• DAX futures point to a slightly higher opening of the European cash session
• Ueda, nominee to succeed Kuroda as BoJ chief, said that he sees inflation as peaking but warned that inflation trends do not improve, yield curve control will need to be maintained.
• Speaking of tweaking BoJ yield curve control tool, Ueda said that targeting shorter-dated yields is one of the options on the table (BoJ currently targets 10-year yield)
• Ueda did not make any specific comments on FX rates apart from saying that discussion on a specific JPY levels should be avoided
• According to a Reuters poll, almost half of Japanese companies want the Bank of Japan to exit the negative rate policy. 47% of respondents think that new BoJ governor should change policy
• China made a cease-fire proposal to Russia and Ukraine. However, it is said that proposal gives too much concessions to Russia and is unlikely to win backing in Kyiv
• According to Der Spiegel report, Russia is holding talks with China over supply of Chinese combat drones as well as know-how needed to manufacture them in Russia
• French finance minister Le Maire said that a new sanctions package on Russia is being prepared
• Japanese CPI accelerated from 4.0 to 4.3% YoY in January (exp. 4.5% YoY). Core CPI accelerated from 4.0 to 4.2% YoY (exp. 4.2% YoY)
• Cryptocurrencies trade mixed but scale of moves is really small. Bitcoin drops 0.1%, Ethereum gains 0.1% and Dogecoin adds 0.2%
• Brent and WTI trade around 0.6% higher each while US natural gas prices drop 0.7%
• Gold gains 0.2%, platinum adds 0.1% and silver trades flat. Palladium rallies over 1%
• NZD and JPY are the best performing major currencies while CHF and USD lag the most

USDJPY experienced some volatility during Ueda confirmation hearings, but is ultimately trading little changed compared to pre-hearing levels. The pair is trading in a short-term 134-135 range.