The euro faces downward pressure as policy divergence with the Federal Reserve continues, while geopolitical concerns add uncertainty. The British pound remains stable amid limited economic data, with traders awaiting key reports this week. The Japanese yen has strengthened due to strong growth data, supporting expectations of a hawkish stance from the Bank of Japan. The Australian dollar edges higher as the market anticipates an interest rate cut from the RBA. Gold continues its bullish trend, supported by investor demand for safe-haven assets amid global uncertainties and U.S. policy concerns.
EUR/USD
Market Analysis:
The EUR/USD pair has been experiencing a bearish hourly trend, currently trading around the resistance level of 1.0515. Despite last week’s upward movement, sellers have started fixing their positions. The Eurogroup’s focus on financial stability, economic recovery, and geopolitical concerns adds further uncertainty, making the euro susceptible to volatility. The European Central Bank (ECB) is expected to cut rates at least twice more before the Federal Reserve, putting downward pressure on the euro.
Forecast:
In the short term, EUR/USD is likely to continue testing support and resistance levels within its current range. If the price consolidates above 1.0515, a push towards the next resistance at 1.0537 is probable. On the downside, a break below the support level of 1.0456 could open the path to 1.0390 and further towards 1.0317.
Key Levels:
- Support: 1.0456, 1.0390, 1.0317, 1.0272
- Resistance: 1.0515, 1.0537
Outlook: Bearish in the short term, with a chance for a corrective bounce if 1.0456 holds firm.
GBP/USD
Market Analysis:
The GBP/USD pair is trading in a bullish trend, hovering around the 1.2614 resistance level. The lack of UK economic data has led to subdued trading, though upcoming employment data, CPI, retail sales, and PMI releases may spark volatility. The Bank of England is unlikely to cut rates at its next meeting in March, delaying significant monetary easing until May.
Forecast:
If GBP/USD consolidates above 1.2614, it could test the next resistance at 1.2667. Failure to break this level might trigger a retracement towards the support at 1.2555. A decisive drop below 1.2335 would confirm a shift back to a bearish trend.
Key Levels:
- Support: 1.2555, 1.2480, 1.2396, 1.2335
- Resistance: 1.2614, 1.2667
Outlook: Bullish in the near term, though subject to sharp corrections.
USD/JPY
Market Analysis:
USD/JPY has maintained a bearish medium-term trend, with the yen strengthening due to Japan’s strong Q4 GDP data. The pair recently tested support at 151.62. Market participants are closely watching for signs from the Bank of Japan about future rate hikes, likely not expected until summer.
Forecast:
If USD/JPY breaks below 151.62, the next support lies at 151.12. Resistance stands at 152.32 — a level that could be tested if the pair rebounds. A break above 155.52 would invalidate the current bearish trend.
Key Levels:
- Support: 151.62, 151.12
- Resistance: 152.32, 153.59, 154.33, 155.04, 155.52
Outlook: Bearish, with a potential for corrective bounces.
AUD/USD
Market Analysis:
The AUD/USD pair is trading at 0.6363, gaining for the third consecutive day. The Reserve Bank of Australia (RBA) is expected to cut rates to 4.1% soon, a move largely priced in by the markets. The pair is currently pressing against resistance at 0.6376.
Forecast:
If AUD/USD breaches 0.6376, it could target 0.6401. On the downside, 0.6344 remains a crucial support level. A drop below 0.6319 may accelerate the bearish trend towards 0.6260.
Key Levels:
- Support: 0.6344, 0.6319, 0.6260, 0.6210
- Resistance: 0.6376, 0.6401
Outlook: Neutral with a slight upward bias, but capped by RBA rate cut expectations.
Gold (XAU/USD)
Market Analysis:
Gold is trading around $2,898 after a pullback from record highs near $2,940. The precious metal remains within a bullish trend channel. Geopolitical tensions and trade concerns have kept gold attractive as a safe-haven asset, though recent US diplomatic efforts have tempered its rise.
Forecast:
If gold holds above $2,908, a rally towards $2,968 is possible. Support lies at $2,890 — a break below this level could see gold test $2,850 and potentially $2,830.
Key Levels:
- Support: 2,890, 2,850, 2,830
- Resistance: 2,908, 2,950, 2,968
Outlook: Bullish, with room for a pullback towards support before a renewed push higher.
Conclusion:
- EUR/USD: Bearish, watching for a test of 1.0456.
- GBP/USD: Bullish, but resistance at 1.2614 could cap gains.
- USD/JPY: Bearish, support at 151.62 is key.
- AUD/USD: Neutral to slightly bullish, resistance at 0.6376.
- Gold: Bullish, support at $2,890 will determine direction.
