SUMMARY

  • Canada’s annual CPI came in at 2.4%, up from 2.6% in the previous report.
    The Bank of Canada could start cutting interest rates in the second quarter of
    the year.
    • USDJPY has lost the 150 zone, and is currently down -0.03% at 149.94.
    • Significant rebound in EURUSD from 1.0700 support. The currency is up 1.14%
    since February 14, 2024. The currency is currently up +0.01% and trades at
    1.0815.

GOLD

Specifications

  • Leverage: 50
  • Units: 100
  • Margin requirement: $4,006 USD 
  • Example: $10 USD change in gold price = 1000 USD potential PL.
  • Support 1: 2034,99
  • Support 2: 2033,52
  • Resistance 1: 2037,59
  • Resistance 2: 2038,72

Fundamental Analysis

  • Canada’s annual CPI came in at 2.4%, up from 2.6% in the previous report. The Bank of Canada could start cutting interest rates in the second quarter of the year.
  • Traders are eagerly awaiting statements from FOMC delegates on U.S. macroeconomic data. The minutes of the last FOMC meeting will also be presented.
  • Japan’s services PMI is expected to come in at 53.1, which should put it in the expansion zone.
  • The gold price has managed to maintain its uptrend from the pivot point of 1,984 USD. At the moment, the price is up +0.11% and is trading at USD 2,027 per troy ounce.
  • The price remains above its 40-day moving average and is looking to break above the current resistance at 2,030 USD. If successful, the next target would be USD 2,040.

USDJPY

Specifications

  • Leverage: 100
  • Units: 100,000
  • Margin requirement: USD$667
  • Example: movement of 100 pips = $1,000 potential PL.
  • Support 1: 149,96
  • Support 2: 149,93
  • Resistance 1: 150,07
  • Resistance 2: 150,13

Fundamental Analysis

  • At the moment, the USDJPY is up +0.14% and is trading at 150.32. Buyers are looking for the currency to rise above 151.
  • Japan’s trade balance will be released today and is expected to come in at USD -1.9 billion. Exports are expected to increase by 9.5% y-o-y.
  • The trade balance data is important because the Bank of Japan can assess the volume of money flowing in or out of the Japanese economy and its effect on the exchange rate and money supply. Currently, the yen’s money supply is shrinking, so the price of the currency continues to rise.
  • US Treasury yields continue to rise as investors seek to hedge their equity positions with fixed income instruments, given the potential slowdown in the US economy.
  • USDJPY is above the 40-day moving average and price is looking to break above the upper Bollinger band to move higher towards resistance at 151.

EURUSD

Specifications

  • Leverage: 100
  • Units: 100,000
  • Margin requirement: USD$1,071
  • Example: movement of 100 pips = $1,000 potential PL.
  • Support 1: 1.0812
  • Support 2: 1.0809
  • Resistance 1: 1.0818
  • Resistance 2: 1.0821

Fundamental Analysis

  • Significant rebound of the EURUSD from the support level of 1.0700. The currency has risen by 1.14% since February 14, 2024. The currency is currently up +0.01% and is trading at 1.0815.
  • Bulls are looking to consolidate the 1.0800 area after the currency hit a two-week high. Traders continue to take positions in the EURUSD ahead of the Eurozone PMIs due for release on Thursday.
  • According to the Chicago Mercantile Exchange’s FedWatch, the Fed could cut rates by 25 basis points at its June meeting.
  • Better PMIs are expected in the Eurozone, but the market knows that the economic bloc is still in recession.
  • EURUSD, above its 40-day moving average, is looking to gain momentum to attack the 1.0840 area again.

SOURCES

  • Thomson Reuters
  • Market watch
  • Bloomberg
  • Tradingview

 

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