Last week began with Chinese inflation data surpassing expectations, driven primarily by increases in food and services prices due to heightened consumer demand during the Spring Festival period. In Japan, the Final Q4 GDP figures were revised significantly higher, indicating a positive trend and invalidating the technical recession.

All week, we heard many ECB members, raising concerns regarding the initiation of rate cuts in June, which is starting to weigh on the Euro. On Tuesday, disappointing UK February jobs statistics were reported, with the unemployment rate rising and employment change figures falling short of expectations. January GDP figures were in line with forecasts, showing modest growth.

In the US, February CPI data exceeded expectations, with both year-on-year and month-on-month increases surpassing projections. Core CPI also showed higher-than-expected growth, reflecting ongoing inflationary pressures. These developments underscore the challenges posed by inflationary trends in various economies. The PPI (producer price index) also came higher than expected on Thursday, keeping the USD in demand, despite some weaker retail sales and consumer sentiment.

This Week’s Market Expectations

This week we have five major central banks holding their meetings, however, none of them is expected to make a move in the monetary policy this time. But, we are heading toward the start of policy easing, so traders will be focusing on comments and hints about the date of the first rate cut. Today we have the Chinese Industrial Production and Retail Sales report to start the new week.

Monday:

• Chinese Industrial Production and Particularly Retail Sales data for February will provide insights into consumer spending trends.
• Eurozone Final CPI figures for February will be released, offering a final look at inflation in the Eurozone.

Tuesday:

• The Bank of Japan (BoJ) and Reserve Bank of Australia (RBA) will make their monetary policy announcements.
• The German ZEW Survey for March will gauge investor sentiment in the Eurozone’s largest economy.
• Canadian CPI data for February will be released, shedding light on inflationary trends in Canada.

Wednesday:

• The Federal Open Market Committee (FOMC) will announce its monetary policy decision, with a focus on interest rates and economic outlook.
• The People’s Bank of China (PBoC) will announce its Loan Prime Rate (LPR).
• Several other central banks, including the Brazilian Central Bank (BCB), Czech National Bank (CNB), and Bank of Israel (BoI), will make their policy announcements.
• UK CPI data for February and New Zealand GDP data for Q4 will be released.

Thursday:

• The Bank of England (BoE), Swiss National Bank (SNB), Norges Bank, and Central Bank of the Republic of Turkey (CBRT) will announce their monetary policy decisions.
• Flash PMI data for March will be released for the Eurozone, UK, and US, providing insights into manufacturing and services sectors.
• US Philly Fed data for March and New Zealand Trade Balance data for February will also be released.
• Japanese CPI data for February will offer insights into inflation trends in Japan.

Friday:

• Japan’s Rengo (labour union) 2nd Pay Tally will be released.
• The Central Bank of Russia (CBR) will announce its monetary policy decision.
• Australian Jobs Report for February, UK Retail Sales data for February, and German Ifo Survey for March will be released.

Forex Signals Update

Last week the volatility was low until Friday, when the USD decided to make a bullish move ahead of the weekend. As a result, the number of our forex signals was limited, opening 15 trades in total. However, the results were great, as we only had one losing signal, while the rest closed in profit, giving us a great win/loss ratio.

Gold Starting to Make A Reversal Lower

Gold prices experienced a decline last week, with XAU/USD dropping to $2,152. However, this level has proven to be a support zone for gold, as evidenced by yesterday’s rally followed by another bounce today. This suggests that the $2,152 level is effectively supporting gold prices, indicating an opportunity for buying at this level. We opened several buy Gold signals against this support zone, but the price keeps returning to it, so there’s a chance that we will see a break below $2,150 this week.

XAU/USD – 240 minute chart

The Range Getting Narrower for EUR/GBP

The rebound off the support zone around 0.85 and the subsequent encounter with resistance at the 50-day simple moving average (SMA) of 0.8553 suggest a potential struggle for EUR/GBP to establish a clear direction. However, the formation of a bullish double-bottom pattern around the base of 0.8500, combined with weaker UK wage and employment data, indicates a possible bullish reversal in the near term. This pattern typically signals increased buying interest, which was evidenced by the upward movement in price later in the week. Despite these bullish signals, the stability of the moving averages, particularly the resistance provided by the 20 SMA (grey), suggests ongoing downward pressure on the pair.

EUR/USD – 240 minute chart

Cryptocurrency Update

Bitcoin Dips Below $68,000 but the 100 SMA Holds

Bitcoin (BTC) had a significant volatile week last week, pushing to a new record high above $73,000 in the first few days. During this period, the cryptocurrency found support at Moving Averages. But, those moving averages were broken toward the end of the week, as sellers returned and pushed the BTC price below $65,000 on Saturday. However, buyers came back yesterday and they pushed BTC/USD above $68,000.

BTC/USD – 240 minute chart

The 100 SMA Holds As Support for Ethereum 

ETH (Ethereum) continued its upward trajectory last week, despite experiencing a bearish reversal after reaching the significant milestone of $4,000. Despite this reversal, ETH managed to find support above the 50-period Simple Moving Average (SMA) on the H4 chart, a crucial technical indicator. This support level attracted buyers, leading to a rebound in Ethereum’s price. Consequently, ETH reached a new yearly high of $4,100 early last week, but later we saw a retreat and now Ethereum is trading below $4,000 again.

ETH/USD – 240 minute chart