March 21st Morning Brief – It’s All Technical Now
Dave Green • 2 min read
Welcome back, traders. It's such an amazing feeling to see green pips in the morning. Our gold signal just hit a take profit of 48 pips at $1228.70 along with a forex signal in EUR/CHF.
The U.S dollar traded lower on Monday and fell more than 25 pips throughout the day. The index continued to trade on the bearish bias based on the sentiments from last week. Specifically, the dovish Yellen and interest rate hikes played big roles.
Yesterday, the Fed member Evans attempted to support the U.S dollar by proposing a potential 4th rate hike in 2017. This remark reflects the confidence of Fed officials in regards to the U.S outlook. Perhaps, he was trying to compensate for the dovish remarks from Fed chair Janet Yellen last week. In other news, today in the early Asian sessions, the Reserve Bank of Australia came into focus, but the event resulted in only a muted impact on the market.
Major Events to Watch Today
- CPI y/y (10:30)
- PPI Input m/m (10:30)
- Public Sector Net Borrowing (10:30)
- RPI y/y (10:30)
- BOE Gov Carney Speaks (11:35)
- FOMC Member Dudley Speaks (11:00)
- Current Account (13:30)
- ECOFIN Meetings (All Day)
- Core Retail Sales m/m (13:30)
- Retail Sales m/m (13:30)
EUR/USD – The Top Traded Currency Pair
The single currency, Euro, is again on its way to place new intraday highs at $1.07691. Fundamentally, things are getting optimistic in the Eurozone. This week is very important, not only for investors but also for policy makers because the economic calendar is full of manufacturing & services PMI's from France and Germany.
EURUSD – Hourly Outlook
Focusing on the technical side, the 1- hour chart demonstrates a bullish bias for the pair. The RSI value is holding at 59, signaling investor's buynig sentiment. At the movement, the pair is maintaining a narrow trading range of $1.07738 – $1.07235. I see the best opportunity for scalpers, selling at the upper range and buying at the lower range.
USD/JPY – The Safe Haven Currency Pair
Today, the USD/JPY is likely to oppose its well maintained bearish momentum. The pair fell in losses over the previous week as the investors increased their bets for safe haven assets. The Fed policymakers discussed a potential for three or more rate hikes in 2017, but the remarks failed to lift the US dollar.
Looking at the 1-hour timeframe, the RSI is coming out of oversold territory. Moreover, the hammer candlestick followed by strong bearish wave is signaling a potential weakness in the pair.
USDJPY – Hourly Outlook
Consequently, we may see a pullback in the pair due to some bullish retracements. At the moment, the pair is trading at $112.215, right below a major resistance level of $112.900. The breakage above this level is likely to open more room for buying with a potential target of $113.300. On the other hand, $112.475 is a significant support level for today. For now, I am waiting for the appropriate levels to initiate trading signals. So keep following as we may have some trades in the European session today.