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Busy Week Ahead: Focus On The Fed Rate Decision

Published 03/18/2019, 08:08 AM
Updated 07/09/2023, 06:31 AM

EUR/USD: The US Dollar was under pressure after a modest miss on US CPI last week.

Looking ahead, the Fed is scheduled to hold its policy meeting on Wednesday. There is no rate change expected from the Fed. The US Central Bank will also release new forecasts for economic growth. If the Federal Reserve projects a more aggressive interest rate hike, the greenback would rise sharply.

In the Fed’s last meeting, they said it will be “patient” on future interest-rate moves and signaled flexibility on the path for reducing its balance sheet.

The daily resistance level of 1.1355 is critical for the EUR/USD pair. In order for the rise to gain more momentum, it needs to break out and stay above 1.1355 on a daily basis. At this point, we will see the next resistance level at 1.1450. Otherwise, the support levels will be at 1.1285 and 1.1219.

Support: 1.1285 - 1.1219 - 1.1103

Resistance: 1.1355 - 1.1450 - 1.1554

GBP/USD: The British Parliament rejected May's deal to quit the European Union last week. Also, The UK parliament voted overwhelmingly to seek a delay in Britain's exit from the European Union.

However, the PM has promised a third and final vote on her Withdrawal Bill – expected on Tuesday – and is likely to lose that vote as well. If this is the case, the UK will apply to the EU for an extension of Article 50.

The BoE will announce its rate decision this week. The market expects the BoE keeps unchanged their benchmark interest rates at 0.75%. Moreover, we will focus on the monthly jobs report, as well as the latest inflation and retail sales in the UK.

In order for the Sterling to gain more value against the US Dollar, it needs to break out and stay above 1.3290 on a four hourly basis. Should this occur, we will follow the daily resistance level at 1.3365. Otherwise, the support level can be found at 1.3217 again.

Support: 1.3217 - 1.3152 - 1.3055

Resistance: 1.3290 - 1.3365

USD/JPY: Last week, the Bank of Japan maintained its policy balance rate and 10y yield target at -0.1% and 0% respectively and left its asset purchase program unchanged. The BoJ also downgraded its view on the economy, including its assessment of exports, industrial production, and overseas economies.

We will focus on the daily support level of 111.18 in the USD/JPY pair. As long as the index stays above 111.18 on a daily basis, the fall may be limited and we will see the key resistance level at 111.85 again. On the other hand, if the currency breaks down below 111.18, the next support level can be seen at 110.35.

Support: 111.18 - 110.35 - 109.57

Resistance: 111.85 - 112.37 - 112.98

GOLD: The Gold Price showed an upward movement intraday. In order for the rise to gain more momentum, it needs to break out and stay above 1305 on a four hourly basis. In this case, the daily resistance level will be placed in 1316. Otherwise, the daily support level will be found in 1291 again.

Support: 1291 - 1278 - 1266

Resistance: 1305 - 1316 - 1327

S&P 500 INDEX: The S&P 500 futures index is trading above the 2821 daily support level. If the index is able to stay above 2821 on a daily basis, the bullish action may gain more momentum and we will see 2851 as a resistance level. On the other hand, if the index drops below 2821, the next support level is holding at 2780.

Support: 2821 - 2780 - 2727

Resistance: 2851 - 2896 - 2928

CRUDE OIL: Focus on the main resistance level of 59.01 in the Crude Oil Price. In order for the rise to gain more momentum, it needs to break out and stay above 59.01 on a four hourly basis. At this point, we will see the next resistance level at 60.38. Otherwise, the support levels will be at 57.88.

Support: 57.88 - 56.67 - 55.43

Resistance: 59.01 - 60.38 - 61.57

DOW 30 INDEX: The DOW 30 futures index is now trading above the 25821 daily support level. As long as the index stays above 25821 on a daily basis, the upward movement may continue and the resistance level can be found in 26062. On the other hand, if the price falls below 25821, we will follow 25560 as a support level.

Support: 25821 - 25560 - 25218

Resistance: 26062 - 26335 - 26596

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