Markets Week Ahead: Nasdaq Slips, Gold Steadies, Central Banks on Tap

The economic data and central bank calendars are packed full next week with a range of potentially market-moving releases. Five central banks will announce their latest monetary policy decisions, with the Bank of Japan the most interesting. Markets currently see a 40% chance that the BoJ will hike rates by 10 basis points as the latest Japanese wage negotiations show large hikes to workers’ pay across various industries.

Japanese Wages Rise to a 30-Year High, Fuelling BoJ Rate Speculation

Along with the central bank announcements, there are important data releases throughout the week with UK inflation, German Manufacturing PMIs, and Euro Area sentiment PMIs the standouts.

The US dollar rallied Thursday after the latest US PPI data showed wholesale price inflation increasing. As it stands, it is unlikely that this release will overly worry the Federal Reserve but it serves as a reminder that price pressures remain sticky in the US.

US Dollar Soars on Inflation Risks as Fed Looms; EUR/USD, GBP/USD, USD/JPY

Markets Overview – Gold, Nasdaq, Nvidia, MicroStrategy

Gold has been under pressure this week due to the US dollars rebound, although the precious metal remains near a multi-decade high. Technical analysts will be closely watching a Bullish Pennant formation that is nearly complete. The next few days will see if this pattern plays out.

Gold Daily Price Chart

Learn how to trade gold with our complimentary guide:

The Nasdaq ended the week lower and is starting to fall out of a multi-month ascending trend. The tech bellwether is also showing signs of topping out and unless Fed Chair Powell turns dovish at the FOMC meeting on Wednesday, the Nasdaq may continue to struggle.

Nasdaq 100 Daily Price Chart

One of the largest companies in the Nasdaq, Nvidia, is also struggling. The chip giant balked at just under the $1,000 level on March 8th and despite a couple of short-term rallies, Nvidia ended lower on the week.

Nvidia (NVDA) Daily Price Chart

MicroStrategy has been rallying hard in recent weeks, on the back of heavy ETF demand for Bitcoin. MicroStrategy holds in excess of 200,000 Bitcoin on its books and continues to buy BTC on a regular basis. MSTR posted a fresh high again on Friday, despite Bitcoin selling off with talk that a short-squeeze may be happening after traders piled in on the short MSTR/long BTC arbitrage. These positions are underwater and traders’ losses are mounting up.

MicroStrategy (MSTR) Daily Price Chart

All Charts using TradingView

Technical and Fundamental Forecasts – w/c March 18th

British Pound Weekly Forecast: GBP/USD Could Struggle as Rate Setters Convene

This week will bring policy decisions from central banks on both sides of GBP/USD.

Euro (EUR/USD) Forecast – Fed and BoE Will Drive EUR/USD and EUR/GBP Price Setups

Euro traders will be looking at the Federal Reserve and the Bank of England this week to help gauge EUR/USD and EUR/GBP future price levels.

Gold Price Forecast: Fed in Spotlight – Bullish Explosion or Crash Ahead?

The Federal Reserve's decision and monetary policy guidance in the coming week will be the focus of financial markets. A hawkish outcome could be positive for the U.S. dollar and yields, but bearish for gold prices.

US Dollar Forecast: FOMC in View – Setups on EUR/USD, GBP/USD, USD/JPY

The FOMC will deliver updates on monetary policy and reveal the latest ‘dot plot’ which will confirm whether Fed officials maintain their prior stance of three cuts in 2024

https://www.dailyfx.com/news/markets-week-ahead-nasdaq-slips-gold-steadies-central-banks-on-tap-20240317.html