2024-04-28 08:14

The euro strengthened on upbeat Eurozone business activity data. The dollar was weak as business activity in the US fell more than expected. The core PCE price index aligned with expectations, holding at 0.3%. The EUR/USD weekly forecast leans slightly bullish as the dollar faces pressure from weakening economic indicators. Ups and downs of EUR/USD The week was bullish for the EUR/USD pair as the euro strengthened on upbeat Eurozone business activity data. Still, policymakers remain convinced that the ECB will implement its first cut in June. –Are you interested to learn more about crypto signals? Check our detailed guide- Meanwhile, the dollar was weak as business activity in the US fell more than expected. Moreover, the gross domestic product figures missed forecasts, indicating a slowdown in the economy. Despite this, inflation figures remained high, leading to a decline in rate-cut expectations. The week ended with the core PCE price index, which aligned with expectations, holding at 0.3%. Next week’s key events for EUR/USD Next week, the US will have three key events: the FOMC policy meeting, the ISM manufacturing PMI, and the NFP report. All these will go a long way in shaping the outlook for Fed rate cuts. At the Fed meeting, markets expect the central bank to hold rates at 5.50%. However, more emphasis will be given to what policymakers say regarding the future, especially inflation. Hawkish guidance could lead to a decline in rate cut expectations that would see the EUR/USD pair decline. Similarly, investors will look for policy guidance in the nonfarm payrolls report. The last few months have shown solid demand in the labor market, which has delayed Fed rate cuts. Another upbeat report could push back the timing for the first rate cut to November. EUR/USD weekly technical forecast: Bears eye 1.0500 as pullback meets resistance On the technical side, the EUR/USD price is trading near the 1.0725 key resistance level and the 22-SMA line. The price retests this level after breaking below to make a new low. –Are you interested to learn more about forex robots? Check our detailed guide- Notably, the bias is bearish as the price has made a series of lower lows and highs. At the same time, it has respected a bearish trendline and the 22-SMA as resistance. Therefore, there is a high chance this trend will continue next week. The price might bounce lower to retest the 1.0500 key support level. Moreover, if it breaks above the SMA, then it will meet the trendline resistance, which will likely reverse it lower. https://www.forexcrunch.com/blog/2024/04/28/eur-usd-weekly-forecast-focus-turns-to-fed-nfp-next-week/

2024-04-27 08:47

Several economic reports from the US pointed to a slowdown in the economy. US business activity fell in April, showing the impact of higher interest rates. Investors will focus on the FOMC meeting and the jobs report from the US. A subtle bearish trend emerges in the USD/CAD weekly forecast as the dollar relinquishes its strong position amid the slowdown in the US economy. Ups and downs of USD/CAD The USD/CAD pair had a bearish week characterized by dollar weakness. Several economic reports from the US pointed to a slowdown in the economy that weighed on the dollar. Notably, business activity fell in April, showing the impact of higher interest rates. –Are you interested to learn more about crypto signals? Check our detailed guide- Similarly, the economy grew at a smaller-than-expected 1.6% rate in the first quarter. Although this was a welcome relief for the Fed, inflation remained high, leading to a drop in rate cut expectations. Next week’s key events for USD/CAD Next week, Canada will release its gross domestic product report. Canada’s economy has slowed down significantly as higher interest rates lower demand. A weak GDP report would likely increase the chances of the first BoC cut in June. Meanwhile, investors will focus on the FOMC meeting and the jobs report from the US for clues on when the Fed might start cutting interest rates. Due to the stubborn inflation, the central bank will likely hold rates and call for patience on rate cuts. Additionally, the NFP report could surprise on the upside again. In such a case, investors would scale back Fed rate cut expectations. USD/CAD weekly technical forecast: Uptrend pauses, pullback reaches SMA support On the technical side, the USD/CAD price has pulled back to retest the 22-SMA after finding resistance at the 1.3840 key level. At the same time, the RSI has fallen to the 50-mark, which it respects as support. This is a sign that the bullish trend has paused for a pullback. –Are you interested to learn more about forex robots? Check our detailed guide- Moreover, the price now trades with the nearest support at 1.3601 and the nearest resistance at 1.3840. Since it is in a bullish trend, making higher highs and lows, it might respect the SMA as support and climb to retest the nearest resistance. Still, a sentiment shift will occur if the price breaks below the SMA and the nearest support level. This would signal a bearish takeover, allowing the price to target the 1.3400 support level. https://www.forexcrunch.com/blog/2024/04/27/usd-cad-weekly-forecast-slowing-us-economy-dents-dollar/

2024-04-26 09:36

On Friday, the BoJ held rates as expected, lending room to the USD/JPY price. Traders panicked when the yen suddenly jumped for no apparent reason. The US GDP increased by 1.6% in Q1, missing forecasts. The USD/JPY price analysis remains bullish as the spike down quickly returned amid the BoJ’s inaction. Meanwhile, there was caution ahead of US inflation data that might shape the outlook for Fed rate cuts. On Friday, the BoJ held rates as expected. Moreover, policymakers noted that inflation was on a clear path to the central bank’s 2% target. This means the BoJ will likely hike interest rates later in the year. However, investors were disappointed as there was no clear message on the policy outlook. As a result, the yen plunged, allowing the USD/JPY pair to breach the $156.00 level. After the policy announcement, there were concerns that Japan would intervene to support the weak currency. Therefore, traders panicked when the yen suddenly jumped for no apparent reason. However, the move soon reversed itself. The last time the BoJ sold dollars to support its currency was in 2022. The recent weakness to 34-year lows has increased speculation that the central bank might intervene again in 2024. The USD/JPY price rose despite a weaker dollar. Notably, the dollar was weak after data from the previous session revealed a bigger-than-expected decline in economic growth. In Q1, the GDP increased by 1.6%, missing forecasts for an increase of 2.4%. A slowdown in the economy increases the chances that the Fed will cut interest rates. However, the inflation figures in the report revealed a different story. Underlying inflation jumped, leading to a significant drop in Fed rate cut expectations. Investors will now watch the core PCE price index for more clues on the Fed’s policy outlook. USD/JPY key events today BOJ press conference US core PCE price index US consumer sentiment USD/JPY technical price analysis: Bullish momentum holds within the channel On the technical side, the USD/JPY price has made a volatile candle that has tested its channel’s support and resistance. At the same time, it retested the 30-SMA support. However, the bullish bias remains intact since the candle has stabilized above the previous candle. -Are you looking for automated trading? Check our detailed guide- The price now sits above the 156.00 critical level and might soon reach the 157.00 resistance. However, the RSI is well above 70, showing the price is overbought. Therefore, it might pause or pull back before it continues higher. https://www.forexcrunch.com/blog/2024/04/26/usd-jpy-price-analysis-bojs-inaction-weakens-yen/

2024-04-26 08:18

Wednesday’s data revealed weaker US economic growth in the first quarter. A measure of US core personal consumption expenditures jumped by 3.7%. Investors are cautious ahead of today’s core PCE price index report. The GBP/USD outlook remains bullish as the dollar loses ground following a disappointing gross domestic product report. However, the inflation figures buried within the report triggered a notable shift, dampening expectations for a Fed rate cut. As a result, investors are eager to receive the core PCE price index figures from the US. Wednesday’s data revealed weaker US economic growth in the first quarter. The gross domestic product grew at an annual rate of 1.6%, missing forecasts for 2.4%. This indicates a slowdown in the economy that would have given policymakers confidence that inflation would reach the 2% target. However, within the same report, a measure of core personal consumption expenditures rose by 3.7%, beating forecasts for a 3.4% increase. The increase indicates hotter-than-expected inflation. The Fed will hesitate to cut interest rates if inflation remains stubborn and persistent. Consequently, investors are cautious ahead of today’s core PCE price index report. The GDP figures increased fears that today’s report will also show a bigger-than-expected increase in inflation. After the GDP report, markets lowered the likelihood of a Fed rate cut in September to 58% from 70%. Meanwhile, the chances of a cut in November increased to 68%. This puts the Fed in a more hawkish position than the Bank of England, which might cut in June or August. Consequently, there might be more declines in the GBP/USD pair. GBP/USD key events today US core PCE price index m/m US revised UoM consumer sentiment GBP/USD technical outlook: Bulls approach solid resistance barrier On the technical side, the GBP/USD price is bullish as it climbs higher above the 30-SMA. At the same time, the RSI indicates solid bullish momentum as it trades well above 50. The recent shift in sentiment has allowed bulls to target the 1.2550 critical resistance level. This would allow the price to retrace 61.8% of the previous downtrend. -Are you looking for automated trading? Check our detailed guide- However, this means a strong resistance barrier. If the price fails to break above, it might pause to retest the 30-SMA. Meanwhile, if bullish momentum remains strong, a break above 1.2550 would allow the price to target the 1.2701 resistance. https://www.forexcrunch.com/blog/2024/04/26/gbp-usd-outlook-dollar-slides-on-disappointing-gdp-figures/

2024-04-25 09:40

Markets expect the Bank of Japan to maintain rates tomorrow. The yen will remain weak if Japan maintains its gradual rate hike outlook. As the USD/JPY pair continues to climb, the risk of intervention grows. The USD/JPY outlook remains bullish as the yen weakens in anticipation of the Bank of Japan’s policy decision. However, investors are treading cautiously as the risk of intervention looms large following the recent surge above the $155 level. On Thursday, the Bank of Japan started its policy meeting to decide on interest rates. When the meeting ends tomorrow, markets expect the central bank to hold rates. However, policymakers might give a hawkish message about the outlook for interest rates. Notably, BoJ governor Kazuo Ueda has assumed a more hawkish tone in recent weeks due to the sharp decline in the yen. He has repeatedly said that the central bank might hike rates to support the weak currency. A weak yen drives trend inflation as it increases import prices. However, if the Bank of Japan maintains rates, the fundamentals supporting the yen’s decline will remain. The yen has weakened significantly due to the interest rate gap between the US and Japan. Therefore, as long as Japan maintains its gradual rate-hike outlook, the yen will remain weak. Meanwhile, as Japan’s currency plummets, officials in the country have stepped up warnings of a looming intervention. Although such remarks kept it in a tight range below $155, the effect eventually faded. Markets were seeing this level as the line in the sand. However, they have now pushed it up to $160. As the USD/JPY pair continues to climb, the risk of intervention grows. USD/JPY key events today Advance US GDP US jobless claims Pending US home sales USD/JPY technical outlook: New swing high signals bullish momentum surge On the charts, the USD/JPY price has detached from the 30-SMA and made a new swing high, signalling a surge in bullish momentum. This can also be seen in the RSI, which is deep in overbought territory. The price trades in a bullish channel heading for the resistance line. However, bulls must break above the 156.00 key psychological level to reach channel resistance. -Are you looking for automated trading? Check our detailed guide- After such a strong bullish surge, the price might pause at 156.00, where bears might emerge for a pullback. Therefore, the USD/JPY pair might retest the 30-SMA before continuing higher or reversing the trend. https://www.forexcrunch.com/blog/2024/04/25/usd-jpy-outlook-yen-loses-ground-ahead-of-boj-statement/

2024-04-25 09:39

Canada released data showing a drop in retail sales in February. There is more pressure on the Bank of Canada than on the Fed to cut interest rates. A rebound in oil prices supported the Canadian dollar. The USD/CAD forecast points downward as the Canadian dollar rebounds following a dip triggered by disappointing economic data. Notably, the rebound came from a recovery in oil prices as investors weighed the risk of an escalation in Middle East tensions. On Wednesday, Canada released data showing a drop in retail sales in February. Sales fell by 0.1% compared to an expected increase of 0.1%. As a result, markets raised bets that the Bank of Canada will cut rates in June. This led to a significant decline in the Canadian dollar, allowing the USD/CAD pair to rise. However, the pair is now falling after the initial reaction to the news. The policy and economic outlook divergence between Canada and the US continues to grow. Unlike Canada, the US’s last retail sales report beat forecasts to show a strong economy with robust consumer spending. Meanwhile, consumer spending has declined in Canada, and the economy is weaker. At the same time, inflation in the US has stalled its decline, while that in Canada continues to ease. Consequently, there is more pressure on the Bank of Canada than the Fed to cut interest rates. Investors believe the BoC will cut rates in June or July. Meanwhile, the Fed might implement the first rate cut in September. Elsewhere, a rebound in oil prices supported the Canadian dollar on Thursday. Oil recovered after a big drop in the previous session caused by US demand concerns. Although Middle East tensions have eased, the risk of an escalation remains and will likely keep oil prices high. USD/CAD key events today US advance GDP q/q US unemployment claims US pending home sales m/m USD/CAD technical forecast: Trendline break signals a new downtrend On the technical side, the USD/CAD price has broken below its bullish trendline, which confirms a bearish reversal. This comes after the bullish move paused at the 1.3840 key resistance level. Bears took over by first breaking below and retesting the 30-SMA. They confirmed a reversal when the price broke below the trendline and the 1.3700 key level. -Are you looking for automated trading? Check our detailed guide- At the same time, the RSI now trades below 50 in bearish territory, supporting a downtrend. Bears are now targeting the next barrier at 1.3550. https://www.forexcrunch.com/blog/2024/04/25/usd-cad-forecast-data-driven-rise-fades-amid-weaker-dollar/