20th March - FX Technicals & Market Watch
GOLD & CRUDE OverView:
Defensive shift in FOMC policy guidance may stoke global slowdown worries
Gold prices may fall if Fed-inspired risk aversion boosts haven USD demand
Crude oil prices may recoil from 11-month high if cycle-sensitive assets drop.
The US Dollar has continued its post-NFP descent, following a failed test at resistance around yearly-highs earlier this month. This has helped EURUSD to firm while Gold prices are nearing a breakout to fresh March highs.
The FOMC with the bank’s March rate decision. There are minimal expectations for anything new, but the bank’s take on the balance sheet could be a key driver of the risk trade, which could compel volatility in the USD, Treasuries, US Equities and Commodities like Gold.
March FOMC Meeting and US Dollar Price Forecast
The US Dollar has fallen only slightly this week thus far as traders have been awaiting the results of the Fed meeting.
A new Summary of Economic Projections will likely produce weaker growth and inflation forecasts, as well as a reduced glide path of interest rates .
EUR/USD is consolidating near the resistance of the trendline connecting Jan. 31 and Feb. 28 highs pre-Fed and could rise well above 1.14 if the central bank sounds more dovish-than-expected.
The GBP/USD pair trades near the intra-day low of 1.3250 ahead of London open on Wednesday. The pair recently weakened as the US Dollar (USD) registered gains across the board.
The yellow metal recently reversed from 50% Fibonacci retracement of its January 24 to February 20 upmove, which in turn can drag the quote towards an upward sloping supportline stretched since March 07, at $1300 now.
4) Brent OIl
Brent oil is currently trading at $67.58 per barrel.
Disclosure :- The author does not hold any forex trading account while writing.
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