Today market outlook

[Zeologic]

USD/CAD draws indecision candle ahead of overnight rate

The USD/CAD currency pair yesterday drew a Doji candle with long shadows on the top and bottom lines near the upper band line on the daily timeframe. The price formed a high of 1.45212, a low of 143792 open 1.44341, and closed at 1.44326. This temporarily halted the previous two-day bullish trend.

The US jobs data released yesterday, JOLTS Job Openings by the Bureau of Labor Statistics showed 7.74M higher than forecast 7.65M from the previously revised 7.51M. Hires held steady at 5.4M, and total layoffs were little changed at 5.3M. Although job openings were slightly changed but decreased by 728K over the year.

The increase in these data figures somewhat supported the strengthening of the USD. The trade war initiated by United States President Donald Trump against Canada is the reason for the turbulence in the USD currency, including the USDCAD pair lately. Trump imposed 25% tariffs on Canada and Mexico on March 4. He also imposed additional duties on goods from China. Prime Minister Justin Trudeau has threatened to take action in response to Trump's policies. Trudeau said retaliatory tariffs on C$30 billion worth of U.S. imports would go into effect immediately, with more to follow.

The trade war continues. Trump announced an increase in tariffs on steel and aluminum imports from Canada to 50 percent in response to the Ontario government imposing a 25 percent tariff on electricity exported to the US.

Today, investors will focus on the Bank of Canada, which is scheduled to announce its latest interest rate decision, which is expected to be cut by 25 basis points from 3.0% to 2.75%. In addition, investors will also pay attention to the BoC statement,t which may provide subtle clues on Canadian dollar currency policy.

In the US, today will also release CPI data which is an important inflation data used by the Fed to determine their monetary policy. Core CPI is expected to fall 0.3% from the previous 0.4%, monthly CPI is also expected to be 0.3% from the previous 0.5% and annual CPI is expected to be 2.9% from the previous 0.3%.

[Zeologic]

EUR/USD hovers amid moderate US inflation

After hitting a high of 1.09473 on Tuesday, the EURUSD pair drifted lower after the release of US inflation data. Yesterday, the EURUSD price formed a high of 1.09307 and a low of 1.08757, closing at 1.08874. The price drew a bearish candle with a higher low of the previous candle near the upper band line.

Yesterday's US inflation data release showed moderate growth. The US Bureau of Labor Statistics reported that the headline Consumer Price Index slowed sharply to 2.8% year-over-year from an estimated 2.9% from a previously revised 3.0%. The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent on a seasonally adjusted basis in February, after rising 0.5 percent in January. The index for all goods except food and energy increased 0.2 percent in February, following a 0.4 percent increase in January.

A weaker-than-anticipated rise in US inflation is expected to boost market expectations that the Federal Reserve (The Fed) will cut interest rates at its May policy meeting. Meanwhile, according to the CME group's Fedwatch tool, the Fed's target interest rate is projected to be unchanged at its March 19 meeting with a 98.0% probability of leaving the rate at 4.25%-4.50%.

The dollar index (DXY) that tracks the US dollar against six major currencies has shown poor performance in recent weeks due to Trump's policies that are expected to increase inflation, which ultimately reduces household purchasing power. There are even concerns that the US recession will increase due to the impact of Trump's policies.

Today, investors will wait for the release of US PPI data and unemployment claims, which are also the basis for the Fed's considerations in taking their next monetary policy. This month's core PPI is expected to be the same as the previous revision of 0.3%, and the general PPI is 0.3% from the previous 0.4%. Meanwhile, Unemployment Claims are expected to increase by 226k from the previous 221k.

[Zeologic]

Silver breaks $33; precious metal gains positive traction amid trade war

The price of silver (XAGUSD) yesterday drew a long-bodied bullish candle with small shadows on top and bottom of the candle. Silver price formed a high of 33,959, a low of 32,928, and closed at 33,804. Bollinger Bands appear to be expanding, reflecting rising volatility.

Silver started the rhythm with bullish sentiment. since January, its price fluctuations were relatively in line with other precious metals such as Gold, Copper, Aluminum, and Tin. Silver has an inverse relationship with the US dollar index which is not too strong during the same period with the correlation of the real 10-year US Treasury yield.

The trade war initiated by Trump has brought about fears of a trade-related recession triggering a surge in investors to safe-haven assets such as Gold, Silver, and the Japanese Yen. Besides the trade war, the supply chain may also affect the price. According to the USGS (United States Geological Survey), Mexico leads global silver production, accounting for 24.8% of the world's total. China, with a production of around 3,400 metric tons, controls 13.2%, Peru 12%. The three countries collectively play a role in the global Silver supply chain. While Mexico and China are countries that are hit by Trump's tariff,s which could affect supply and add to the potential for price increases.

Meanwhile, the US PPI data released yesterday by the Bureau of Labor Statistics reported that final demand prices rose 0.6 percent in January and 0.5 percent in December 2024. In February, a 0.3 percent increase in prices for final demand goods offset a 0.2 percent decline in the index for final demand services. Meanwhile, the Department of Labor reported that Unemployment Claims fell to 220k from 222k previously, lower than the forecast of 226.

The dollar index (DXY) has been in retreat since the beginning of this year, now at 103.833, slightly up from a low of 103.221 on March 11. The RSI has been pointing to oversold levels at 25 and is currently trying to break out of that level at 30. The FED is expected to leave interest rates unchanged at its March 19 meeting.

[Zeologic]

USD/CNH, will the rise reach 7.3000?

While the dollar index (DXY) is under pressure, the USD/CNH currency pair is moving near the lower band line. At the end of last week, the price drew a bearish candle with shadows on the top and bottom of the candle. The price formed a high of 7.2542, a low of 7.2307, and a close of 7.2357. During last week's trading, the pair tended to move in a range between the middle and lower band lines.

The dollar index (DXY), which tracks the USD against six major currencies, is now at 103.725 and is still struggling to recover. The dollar index began to come under pressure during President Trump's proposal for import tariffs on some countries, including China. The trade war echoed by Trump has caused market uncertainty, and some analysts are worried that it could trigger a US recession because the impact of the tariff policy is considered to cause inflation.

The Fed is expected to leave interest rates unchanged this month's meeting. According to the CME group's Fedwatch tool, the Fed's target rate probabilities for the March 19th Meeting are estimated at 99.0%, and the cut forecast is only 1%.

Today, China will release some economic data that could be a subtle clue to the country's economic conditions. Industrial Production year-to-year is forecast to fall 5.3% from the previous revision of 6.2%. Retail sales year-to-year are forecast to rise 3.8% from the previous revision of only 3.7%.

On the other hand, US core retail sales are forecast to rise 0.3% from the previous revision of 0.4%. General retail sales are forecast to rise 0.6% from the previous revision of -0.9%.

[Zeologic]

Gold hovers around $3000 ahead of Fed meeting

Last week gold price again hit a new record high at $3004, but trading finally closed lower at 2984. On Monday gold movement tried to rise and drew a bullish candle with a body length almost the same as the previous bearish candle. The price formed a high of 3001 low 2982 closing 3000 near the upper band line. The expanding Bollinger band indicates increased volatility.

The increasing demand for gold seems to be triggered by concerns about a US recession due to some disappointing data. Weak US Retail Sales for February, the NY Fed Empire State Manufacturing Index fell. The US Census yesterday reported Advance Monthly Sales for Retail and Food Services in February 2025 of $722.7 billion up +0.2% from the previous January 2025 of $721.3 Billion or -1.2%. The next release awaits April 16, 2025.

On the other hand, geopolitical risk is still a concern for investors which can boost gold prices. The US vowed to attack Yemen's Houthis until the group stops attacking ships in the Red Sea. Meanwhile, tensions could continue following the Houthis' statement that they will retaliate against the US attacks which could lead to a prolonged conflict.

The dollar index (DXY) seems to still be under pressure, after trying to rise at 104.091, yesterday it fell again to a low of 103.735. The dollar index is used to track the USD currency against six major currencies. The decline in the dollar index is in line with Trump's protectionist policy which began with an import tariff war on several countries that are considered detrimental to the US. However, on the other hand, this policy is considered to be able to trigger inflation.

The Fed at its meeting tomorrow, March 19, is expected to leave interest rates unchanged at 425-450 basis points. According to the CME group's Fedwatch tool, the Fed's possibilities of keeping interest rates unchanged are 98%. However, investors will still be waiting for the Fed's monetary policy decision Jerome Powell's press conference, and the release of the Summary of Economic Projections (SEP).

[KiraBess]

The USD/CNH movement is definitely interesting, especially with the pressure on the dollar index. The economic data from both China and the US will give further insight into the next steps. I also keep an eye on more info about VIX for market volatility—it’s been spiking recently, adding to the uncertainty.

Edited March 20 by KiraBess

[Zeologic]

Ahead of BOJ Policy Rate USD/JPY pair still looking for direction

Yesterday pair of USDJPY drew a hammer candle with a bearish candle ending with a long wick on top candle moved near the middle band line. The price formed a high of 149.935 low of 149.097 and a closing of 149.256. The contracting Bollinger band reflects market volatility turning lower.

Amidst the increasing geopolitical risk tensions between Israel and Hamas after Israel attacked Gaza and killed more than 200 people, it could worsen the security situation. On the other hand, the US attacking Houthi is also a geopolitical risk point that is getting hotter. Houthi has vowed to retaliate against the US attack by targeting US ships in the Red Sea.

The performance of the dollar index (DXY) which tracks the USD against six major currencies, is currently still under pressure. DXY fell to 103.197 after trying to recover at 104.091 on March 14. The weakening performance of the dollar index may have been triggered by concerns about a US recession due to Trump's policies that could drive inflation.

Next, investors will focus on the BOJ and FED decisions. Today, the Bank of Japan will announce its interest rate policy which is expected to remain the same as the previous revision of 0.50%. Meanwhile, the Fed is also expected to leave interest rates unchanged at its meeting tomorrow.

Despite the weakening performance of the USD, investors seem to favor the US dollar over the Japanese Yen, which is seen in the USDJPY pair in bullish sentiment since March 11 after the pair hit a low of 146.542 and the pair tried to recover at 149.935.

[Zeologic]

GBP/USD hovers around 1.30000 ahead of the BoE rate and UK jobs data

The GBPUSD currency pair yesterday drew a small bullish candle hanging below the upper band line—it was like a hanging man candle. The price formed a high of 1.30111, a low of 1.29550, and a close of 1.30024. The price movement seemed to pause when it reached 1.30000 and has been happening since Tuesday.

The latest data release from the Fed maintained interest rates at 4.50% as previously expected, this gave a little boost to the dollar index (DXY) to gain purchasing power and try to rise from the lowest area in several months. For a moment, the DXY rose to a high of 103.906 from a low of 103.253 and closed at 103.460. Three indicators EMA 20, 100, and 200 still show DXY more bearish sentiment even though RSI is already at the oversold level at 30.

Today there are interesting economic events from the UK related to interest rates and employment data. The Bank of England is expected to leave interest rates still at 4.50% after a decrease in February from the previous 4.75%. Claimant Count Change which is used to measure the change in the number of people claiming unemployment benefits during the previous month, is expected to fall 7.9k from the previous revision of 22.0k.

The Average Earnings Index 3m/y is expected to be 5.8%, up from 6.0%, and the Unemployment Rate is expected to remain at the previous revision of 4.4%.

[Zeologic]

USD/CAD jumped to 1.44015 but closed at 1.43240 as the Fed kept rates unchanged.

Yesterday's Fed meeting finally left interest rates unchanged in the range of 4.25%-4.50%. The Canadian dollar weakened against the US dollar, jumping from a low of 1.43127 to a high of 1.43489. The USD strengthened after the Fed said they were in no hurry to cut interest rates. The dollar index (DXY) strengthened to 104.130, supported by the Fed's decision to leave rates unchanged. For more than a week, the dollar index has moved sideways from a low of 103.197 to a high of 104.130, allowing the currency to be relatively stable against six other major currencies.

Jerome Powell said that Donald Trump's tariff policy tends to make growth go down and inflation go up. This also led Fed officials to revise their core Personal Consumption Expenditure (PCE) price index projection for this year higher to 2.8%, up from the 2.5% projected at the December meeting. They also revised GDP growth lower to 1.7% from the previous projection of 2.1%. Trump’s tariffs that triggered the trade war have caused many investors to be wary of economic uncertainty and to take a wait-and-see approach.

Meanwhile, the BoC is expected to cut rates again at its April meeting by 25 basis points to 2.50%. However, this forecast will still depend on March’s Consumer Price Index (CPI) data.

Meanwhile, Canada will release economic data today on core retail sales which are expected to fall -0.1% from the previous 2.7%. And general retail sales are expected to fall -0.4% from the previous 2.5%.

[Zeologic]

GBP/USD slightly gapped at the opening of the market has been restored

The GBPUSD pair fell at the end of the week as the USD strengthened. Two bearish candles reflect the weakening of the GBP against the USD. The price formed a high of 1.29849, a low of 1.28878, a close of 1.29109. At the opening of the market on Monday, a gap was seen on a low timeframe such as M15 where the open price was somewhat below the previous candle's close, but the gap has been completely restored.

The dollar index (DXY) strengthened for three consecutive days, drawing bullish candles, and reached 104.136 at the end of last week.

The Fed at its meeting last week left interest rates unchanged in the range of 4.25%-4.50% because policymakers were concerned that US President Donald Trump's policies towards his partners could increase inflation. On the other hand, the BoE also kept interest rates unchanged because there was uncertainty about the future. The BoE left interest rates unchanged at 4.50%. This decision was taken after the MPC voted 8-1 to maintain the Bank Rate at 4.5%. One member preferred to lower the Bank Rate by 0.25 percentage points, to 4.25%.

Global trade policy uncertainty has increased, triggered by the United States making tariff policies that have received responses from affected countries, and geopolitical risks that still threaten to increase the risk of volatility in financial markets. Germany as one of the developed countries announced that it will reform its fiscal rules.

Today investors will focus on PMI economic data in Europe, the UK, and the US which are expected to trigger market movements.

[Zeologic]

Gold prices still hold above $3000

Although yesterday the gold price drew a bearish candle, the gold price still holds above the $3000 price level. Yesterday the price drew a small-bodied bearish candle with movement within the previous candle price range. The price has formed a high of 3033, a low of 3002, closing of 3011.

The USD seems to still maintain its short-term broad strength, causing this precious metal to trade slightly above the lowest level in the previously mentioned daily trading. The dollar index (DXY) drew a bullish candle extending its previous increase and has reached a high of 104,444. The RSI is at level 42, increasingly leaving the oversold zone level.

Expectations of Trump's more targeted tariffs than previously threatened provide support for the strengthening of the dollar index. Most recently Trump will announce tariffs on cars, aluminum, and pharmaceuticals in the near future.

Meanwhile, the US PMI data for March was released yesterday, the manufacturing PMI was 49.8, lower than expected at 51.9 from the previous revision of 52.7. Meanwhile, the Service PMI rose to 54.3, higher than the expected 51.2 and the previous revision of 51.0.

There are no relevant economic data releases today, but the US will release the Personal Consumption Expenditure Price Index (PCE) figure on Friday. The PCE is a key indicator that the Fed prefers when making interest rate decisions.

[Zeologic]

Waiting for UK inflation data, GBP/USD rose slightly above the middle band

The GBPUSD pair has still been moving in the price range of 1.28705 - 1.30144 since March 11 between the middle band and the upper band line. Yesterday the pair drew a small-bodied bullish candle with a little shadow on the top and bottom of the candle. The price formed a high of 1.29669 low of 1.29020, closing at 1.29431, although slightly up, but generally still moving in the previous week's range.

The dollar index (DXY), which tracks the USD against six major currencies, fell slightly yesterday at a low of 103.944 from the previous high of 104.467. DXY closed at 104.211. The DXY movement is still below the EMA 20, which may be a dynamic resistance. While the RSI is at level 41 with the potential for a downtrend that may continue.

In the US, according to Adriana Kugler, the Governor of the Federal Reserve, stated that in certain categories, there is evidence that inflation has increased again in recent months. Another Fed official, New York Fed President John Williams, said that businesses and households are experiencing increasing uncertainty about the future of the economy.

US inflation concerns may increase and push the Fed to keep interest rates unchanged, which may increase USD adoption. According to the CME group Fedwatch tool, the Fed's likelihood of leaving interest rates unchanged in the current range of 4.25%-4.50% is 87.1%, and the possibility of a 0.25% cut is only 12.9% at the May 7 meeting later.

Today, investors will focus on UK inflation data, CPI year-on-year is estimated to remain at 3.0% the same as the previous revision. The BoE also maintained the latest interest rate of 4.50% issued in March 20. Besides CPI, investors will also pay attention to the Annual Budget Release, which will outline the government's budget for the year.

[Zeologic]

EUR/USD is more down ahead of US economic data

Yesterday, EURUSD crossed the middle band line and drew a bearish candle extending the previous decline since March 19. The price formed a high of 1.08027, a low of 1.07440, and a close of 1.07537. The economic outlook in several European countries with negative sentiment seems to be the reason for the weakening of the Euro against the US dollar lately. The trade war echoed by US President Donald Trump is expected to also have an impact on Europe. Trump has repeatedly hinted that he will impose tariffs on Europe because it does not buy enough American goods.

The dollar index (DXY) still maintained its strengthening yesterday after dropping to a low of 103.944. Yesterday, DXY rose to 104.683, trying to cross the EMA 20 from the downside. The RSI indicator drew an upward channel pointing to level 47, indicating that the price is increasingly leaving the oversold zone level.

In Europe, expectations of central banks to lower interest rates are increasing, amid economic risks caused by Trump's tariffs on the continent. With low interest rates, it is hoped that it can boost the domestic economy when external conditions are not supportive.

Germany, one of the developed countries in Europe, has extended the borrowing limit to increase defense spending and create a 500 billion Euro infrastructure fund. This could support the circulation of the Euro in the European region, which in turn supports the domestic economy.

On the other hand, ECB President Christine Lagarde tried to ease concerns and stated that the inflationary impact of the trade war was only temporary and would subside in the medium term.

Investors and traders today will pay attention to US economic data. According to Forexfactory, there will be a release of the Final GDP per quarter, which is estimated to be the same as the previous revision of 2.3%. The Final GDP Price Index is estimated at 2.4%. Meanwhile, the Unemployment Claims data is expected to be 225k from the previous revision of 223k.

[Zeologic]

Trump's tariffs threaten the auto industry, USD/CAD slightly up, seeking a new balance.

The USDCAD pair drew a bullish candle yesterday, the Canadian dollar weakened amid US President Donald Trump's new tariff threat on cars manufactured outside the US to be subject to a 25% tariff. Trump's new tariffs will certainly get a response from his trading partner countries, including Japan. Japanese Prime Minister Shigeru Ishiba said his cabinet was considering all kinds of retaliatory measures.

Canadian Prime Minister Mark Carney called Trump's tariffs a direct attack on workers in his country. He said the cabinet would meet on Thursday to discuss retaliatory measures.

In line with Trump's statement, the dollar index (DXY), which tracks the USD against six major currencies, briefly rose to 104.653 but fell later to a low of 104.070 with a close of 104.279. The DXY is moving near the 20 EMA, which seems to act as dynamic resistance at a given time.

US final quarterly GDP data showed a value of 2.4% higher than the expected 2.3%, but the Final GDP Price Index fell 2.3% from the expected 2.4%. While unemployment claims fell 224 from the expected 225k.

Today, investors and traders will focus on the Core PCE Price Index data, which is the Fed's most preferred inflation data for interest rate policy. The PCE index is estimated at 0.3%. On the other hand, Canada will release GDP which is estimated to increase 0.3% from the previous 0.2%.

[Zeologic]

Gold prices hit new record highs amid trade war fears

On Friday, gold prices soared higher, extending gains by drawing a long-bodied bullish candle with almost no shadow. Prices formed a high of 3086, a low of 3054, and a close of 3084.

Investors appear to still be fearful of the impact of the trade war caused by President Donald Trump's tariff policies. Market sentiment is pessimistic as traders prepare for April 2, which was dubbed Liberation Day by US President Donald Trump, who signed an executive order imposing a 25% tariff on all cars imported into the US. This has sparked reactions around the world, especially in Canada and the European Union (EU), which have begun preparing retaliatory measures against the move.

Looking at the PCE data released on Friday, it showed actual 0.4% higher than expected 0.3%. The Bureau of Economic Analysis report showed that personal consumption expenditures (PCE) increased by $87.8 billion (0.4%). Despite the increase in core PCE, San Francisco Fed President Mary Daly expects the Fed to make two interest rate cuts in 2025.

The dollar index (DXY), which tracks the US dollar against six other major currencies, dropped to 104.011 in response to US data on Friday. Previously, the DXY was at a high of 104.498. Meanwhile, according to the CME group's Fedwatch tool, at the Fed's May 7 meeting, the Fed is expected to maintain interest rates at 4.25%-4.50% with a probability of 83.8%, and a cut probability of 4.%-4.25%, only 16.2%.

Today's economic data that may be of concern to investors is the China Manufacturing PMI, which is estimated to be the same as the previous period at 0.5%.

[Zeologic]

AUD/USD drops ahead of RBA rate announcement

The AUDUSD currency pair depreciated ahead of the RBA rate announcement, the price has fallen drawing a long-bodied bearish candle across the lower band with a wick at the bottom of the candle. The price has formed a high of 0.63003 low of 0.62188, and closed at 0.62474.

The Australian dollar's decline was the worst in four weeks against other currencies ahead of the RBA monetary policy meeting due to be released today. Investors expect the RBA to maintain the Official Cash Rate (OCR) at the current level of 4.1%. Therefore, investors will be paying close attention to the RBA's monetary policy guidance.

In the latest developments, President Donald Trump's tariff policy has brought economic fears and is expected to affect the Chinese economy. Trump's "Liberation Day" will announce reciprocal tariffs on April 2 could affect the Chinese economic outlook, given that the world's second-largest country has the largest trade surplus with the US. Here, Australia will be affected by the Chinese economy. This fear seems to have caused the Australian dollar to underperform.

The dollar index (DXY), which tracks the performance of the USD against six major currencies, is trying to recover after weakening. DXY rose to 104.392 from a low of 103.752.

Today, investors will focus on several fundamental data points from the US and Australia. In the US, investors will be waiting for manufacturing PMI data and job openings data. Final Manufacturing PMI is expected to be the same as the previous revision of 49.8, while ISM Manufacturing PMI is expected to fall to 49.5 from the previous 50.3. JOLTS Job Openings are expected to be 7.69 M from the previous 7.74 M.

[Zeologic]

USD/CAD is volatile amid Trump's tariff policy

Yesterday, the USDCAD pair drew a long-bodied bearish candle with a wick on the top of the candle. The price formed a high of 1.44148, a low of 1.42979, and a close of 1.42994. Previously, USDCAD drew a bullish candle with a body of almost the same length.

One possible cause is Trump's tariff policy which triggered a trade war, causing market fears of global economic uncertainty. On the other hand, demand for safe havens seems to be increasing, as seen from the price of gold, which continues to rise.

Trump also threatened to impose large tariffs on Russian oil, and the potential for bombing Iran further raises uncertainty in geopolitical risk.

Meanwhile, investors now seem convinced that slowing US economic growth amid uncertainty surrounding Trump's trade tariffs could force the Fed to continue its interest rate cut policy soon. However, according to the CME group's Fedwatch tool, the Fed is expected to maintain interest rates in the range of 4.25%-4.50% at the May 7 Fed meeting with a probability of 84.5%.

On the other hand, the Dollar Index (DXY), which tracks the USD against six major currencies, is still in doubt, drawing a doji candle yesterday. DXY formed a high of 104.180 low of 104.019, closing at 104.199 with an open of 104.180. Visually, DXY is moving below the EMA 20, indicating a bearish sentiment.

The US JOLTS job openings data released yesterday showed lower than expected figures raising speculation of a weak US economy. The ISM Manufacturing PMI of 49.0 was lower than expected, 49.5 providing negative support to the USD.

Today, traders and investors will focus on the ADP Non-Farm Employment Change, which is expected to rise to 118k from the previous 77k.