Daily Market Analysis

 

Latest Economic and Fundamental Insights

 

• The dollar weakened further on Thursday, extending losses from the prior session and hitting a one-week low around 103. This comes after the Federal Reserve maintained its forecast for three interest rate cuts this year.

• Some analysts believe Fed Chair Jerome Powell might be strategically revealing his intentions. They see him needing a strong justification to hold off on rate cuts, not rush into them.

• With the Federal Reserve meeting concluded, attention now shifts to the Bank of England’s (BoE) interest rate decision later on Thursday. Expectations are for the central bank to maintain current rates.

• Official data released Wednesday showed a slowdown in UK inflation for February, keeping the BoE on track to potentially raise borrowing costs later in 2024.

• Gold prices surged to a record high on Thursday, buoyed by the Fed’s commitment to three rate cuts this year. The central bank’s decision to hold rates steady is seen as positive for gold, making the non-interest-bearing asset more appealing to investors.

• Lower interest rates reduce the opportunity cost of holding gold, which doesn’t generate its own returns. This, combined with a weaker dollar, makes gold cheaper for investors holding other currencies.

• Asian stocks jumped after the US commitment to its rate cut plan. The Fed’s decision to hold rates and target cuts for 2024 fueled this market optimism.

• Oil prices rebounded after a surprise drop in US crude and gasoline inventories. Brent crude is currently trading around $86.00, while WTI crude sits near $81.00.

• The US Energy Information Administration (EIA) reported on Wednesday that crude oil inventories declined for a second consecutive week in the United States, the world’s top oil consumer.

• Stocks unexpectedly fell by 2 million barrels to 445 million barrels during the week ending March 15th. This surpassed analyst expectations in a Reuters poll, which predicted a modest increase of 13,000 barrels.

• The bullish trend for oil appears to be holding strong with another surprise decline in US crude stocks last week. Market participants continue to factor in the risk of further supply disruptions due to the ongoing Russia-Ukraine conflict.

• Bitcoin initiated a strong recovery rally, climbing from the $60,800 zone. The cryptocurrency is currently up nearly 10%, facing hurdles near the $68,800 resistance level.

---

 

Smart technical reports

 

 

How they work

A likely scenario is proposed for today, and the probability of this scenario being achieved, according to technical analysis, may be between 60% and 75%.

If the first scenario fails, the probability of the second scenario being achieved will be between 60% and 75% certain.

The first scenario fails when the price reaches the level of the alternative scenario condition, and the alternative scenario is immediately activated and the prediction from the first scenario is cancelled.

These reports are not considered a substitute for the trader’s decision, but rather they are a tool to assist the follower in making his own decisions, as a reference based on the origins of classical technical analysis.

---

 

GOLD

 

General trend: bullish

Time interval: half an hour (30 minutes)

Current price: 2208.53

The first scenario: Buy gold at a break and hold above 2210.77, with a target price of 2215.83 and 2222.77. Alternative scenario: Sell gold at a break and hold below 2202.54, with a price target of 2196.09 and then 2188.74. Comment: Trading above supports and averages suggests an upward trend

---

 

CRUDE OIL

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: $81.53 per barrel

The first scenario: Buying oil at a break and holding steady by closing the candle at the highest level at $82.01, targeting a price of $82.48, then 83.05. Alternative scenario: Selling oil at a break of $81.33, targeting a price of $80.81, then 80.23.

Comment: Trading above supports and averages suggests an upward trend

---

 

EURUSD

 

General trend:- Bullish

Time interval: half an hour (30 minutes)

Current price: 1.09336

The first scenario: Buy the Euro/Dollar at a break of 1.09494, targeting a price of 1.09679, then 1.09904. Alternative scenario: Sell the Euro/Dollar at a break of 1.09267, targeting a price of 1.09107, then 1.08894. Comment: Trading above supports and averages suggests an upward trend

---

 

GBPUSD

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 1.27872

The first scenario: Buy the pound dollar at a break and hold at the highest level of 1.28099, targeting a price of 1.28385 then 1.28606. Alternative scenario: sell the pound dollar at a break and hold at a close below 1.27763, targeting a price of 1.27565 then 1.27341.

Comment: Trading above supports and averages suggests an upward trend

---

 

NAS100

 

Trend: bullish

Time interval: half an hour (30 minutes)

Current price: 18644

The first scenario: Buying Nasdaq at a break and holding steady with a close above 18657, targeting a price of 18697 then 18743. Alternative scenario: Selling Nasdaq at a break and holding steady with a close below 18598, targeting a price of 18556 then 18513.

Comment: Trading above supports and averages suggests an upward trend

---

 

Economic Calendar

 

(Times are in GMT+3)

• 11:30 AM – Switzerland: Swiss National Bank (SNB) Interest Rate Decision (Q1)

• 3:00 PM – United Kingdom: Bank of England (BoE) Interest Rate Decision (March)

• 3:30 PM – United States:

• Initial Jobless Claims
• Philadelphia Fed Manufacturing Index (March)

• 4:45 PM – United States:

• ISM Manufacturing PMI (March)
• ISM Services PMI (March)

• 5:00 PM – United States: Existing Home Sales (February)

 

Fundamental Analysis

 

 

The US dollar weakened further on Thursday, extending losses from the prior session and hitting a one-week low around 103. This decline comes after the Federal Reserve maintained its forecast for three interest rate cuts this year.

As widely anticipated, the central bank left rates unchanged in March. They also continued to signal their intention to deliver three rate cuts in 2024, although they expect a slower pace of easing in 2025.

During the customary press conference, Chair Powell emphasized the need for more data-driven decisions. He explained that the recent inflation readings for January and February did not alter the overall inflation narrative. Policymakers require greater confidence that inflation is on a sustainable path towards the 2% target before taking further action.

The Federal Reserve also revised its economic forecasts. GDP growth projections for 2024 were nudged upwards to 2.3%, from the previous estimate of 2.2%. Core PCE inflation is also expected to rise slightly this year, reaching 2.1% compared to the prior forecast of 2.0%.

The US currency experienced broad-based selling, with the most pronounced weakness against the Australian dollar.

Meanwhile, gold prices surged to a record high on Thursday. This surge was fueled by the Fed’s commitment to three rate cuts this year. The decision to hold rates steady is seen as positive for gold, as it makes the non-interest-bearing asset more attractive to investors.

Oil prices rebounded on Thursday, supported by a surprise decline in US crude and gasoline inventories. This positive development came despite ongoing market anxieties about the Fed potentially keeping rates higher for a longer period. Brent crude is currently trading around $86.00, while WTI crude sits near $81.00.

The near-term outlook for the dollar remains under pressure as investors continue to factor in the three anticipated Fed rate cuts. Gold prices are likely to benefit from the Fed’s dovish stance, while oil prices are expected to maintain volatility due to the ongoing geopolitical tensions surrounding the Russia-Ukraine conflict.