Marshall Gittler
Trading Analysis
GBP/USD
The dollar traded mixed against its G10 peers during the European morning Monday in the absence of any major market-moving release. It was higher against JPY, GBP, EUR and CHF, in that order, while it was lower vs SEK and NOK. The greenback was unchanged against AUD, CAD and NZD.
The highlight of the week will be the FOMC meeting on Wednesday. With no press conference scheduled or updated projections, the focus will be on the statement accompanying the decision. We expect the statement to recognize the recent stream of soft US data but to emphasize that the Committee still views the weakness to be partly temporarily. If the Committee downplays the weakness in data and continues to argue for a rate hike, along with better data released over the week, USD could regain its strength.
In the UK, the point of interest will be Tuesday’s 1st estimate of Q1 GDP. The forecast is for the growth rate to decelerate a bit despite the strong industrial production in January and February and robust retail sales figures in Q1. A weak growth figure along with the zero inflation rate and the uncertain political outcome in the upcoming elections could result in rate hike expectations getting pushed back even further, leaving GBP vulnerable.
GBP/USD traded lower during the European morning Monday, after hitting resistance at 1.5190 (R1). Although the rate is still trading above the black uptrend line and this keeps the short-term picture somewhat positive, I would expect the retreat to continue ahead of tomorrow’s GDP figure. A weak number could encourage the bears to test the 1.5080 (S1) barrier as a support this time. A move below that hurdle and the aforementioned uptrend line is likely to signal the extension of the bearish wave and perhaps target the 1.4980 (S1) area. Our short-term momentum studies support the continuation of today’s pullback. The RSI exited its overbought territory and is now pointing down, while the MACD has topped and looks ready to move below its trigger line.
Support: 1.5080 (S1), 1.4980 (S2), 1.4875 (S3).
Resistance: 1.5190 (R1), 1.5260 (R2), 1.5330 (R3).
Recommended Content
Editors’ Picks
AUD/USD posts gain, yet dive below 0.6500 amid Aussie CPI, ahead of US GDP
The Aussie Dollar finished Wednesday’s session with decent gains of 0.15% against the US Dollar, yet it retreated from weekly highs of 0.6529, which it hit after a hotter-than-expected inflation report. As the Asian session begins, the AUD/USD trades around 0.6495.
USD/JPY finds its highest bids since 1990, approaches 156.00
USD/JPY broke into its highest chart territory since June of 1990 on Wednesday, peaking near 155.40 for the first time in 34 years as the Japanese Yen continues to tumble across the broad FX market.
Gold stays firm amid higher US yields as traders await US GDP data
Gold recovers from recent losses, buoyed by market interest despite a stronger US Dollar and higher US Treasury yields. De-escalation of Middle East tensions contributed to increased market stability, denting the appetite for Gold buying.
Ethereum suffers slight pullback, Hong Kong spot ETH ETFs to begin trading on April 30
Ethereum suffered a brief decline on Wednesday afternoon despite increased accumulation from whales. This follows Ethereum restaking protocol Renzo restaked ETH crashing from its 1:1 peg with ETH and increased activities surrounding spot Ethereum ETFs.
Dow Jones Industrial Average hesitates on Wednesday as markets wait for key US data
The DJIA stumbled on Wednesday, falling from recent highs near 38,550.00 as investors ease off of Tuesday’s risk appetite. The index recovered as US data continues to vex financial markets that remain overwhelmingly focused on rate cuts from the US Fed.