The Wall Street and US dollar will remain on alert next week as it prepares for the publication of main PCE info. US Fed’s preferred price index, on Friday. The report is expected to increase fluctuation and affect mood. Therefore, investors must be prepared for big swings. So as to react more effectively to swift shifts in market circumstances and US dollar in particular.
The Jan’s underlying PCE is expected to rise by 0.4 percent over the month before, causing a small decrease in the annual figure. Of 2.9 percent to 2.7 percent – a small but promising trend shift. Nevertheless, investors ought not to be taken off surprise should official figures surprise on the up and, matching the patterns and trends found in the Consumer Price Index & PPI reports.
Highlights for Next Week
The latest item on the US economic schedule will begin with the much anticipated publication of Jan’s PCE figures on Friday.
A higher-than-estimated result might boost the US dollar higher, while dull figures could have a detrimental influence on the US currency.
Forex Market Fundamentals
Rising rates of interest for an extended amount of time could push the yields on US bonds higher in the short term. Laying the groundwork enabling the US greenback to embark on its 2024 comeback. Given the US dollar showing an upward tilt, the pound, the euro, and, finally, to some degree, the yen may have difficulties heading towards Mar.
Daily US dollar Graph by TradingView
The EURUSD Pair Technical Perspective
Weekly EURUSD Breakdown covering the Week Ended on Feb 23.
During the week ended the 23rd of Feb, the EURUSD rose 0.40 percent to $1.08175 mark. The EURUSD plummeted to as little as $1.07615 on Tue then hit a top of $1.08883 on Thurs.
On coming Tuesday, the Germany’s economic status is going to be at the forefront. The consumer sentiment data for Mar might heighten worries regarding an extended German financial crisis.
Analysts expect the GfK Consumer Sentiment Indicator to rise from -29.7 towards -27.0 in Mar. Traders have to evaluate the parts, which include revenue and expenditure projections. Spending by individuals provides over 50 percent to the German GDP.
The EURUSD stayed under the fifty-day exponential moving average (EMA). Whilst hanging over the 200 D-EMA, showing negative short-term but positive long-term pricing indications.
A EURUSD breach over the 50-day exponential moving average could encourage a rally towards the $1.09294 barrier mark. To regain the $1.09 level, the pair has to break below obstacles at Thursday’s top of $1.08883 hurdle.
The rate of inflation and monetary policy forecasts should be considered. Nevertheless, a decline beneath the 200 D- EMA with $1.07838 supporting area will allow sellers to attack its $1.06342 supporting area. The 14-time frame daily RSI of 50.36 shows that EURUSD will climb to reach the $1.09294 barrier point prior exiting overheated terrain.
GBPUSD Technical Outlook
The GBPUSD duo rose over the past week yet unable to break beyond its 50 d-SMA of 1.2680 level. Exceeding this directional barrier may prove difficult for bullish. But its breach may suggest an advance to trend line barrier around 1.2725 mark. Over this point, the spotlight is going to be on 1.2830 area.
In the event that traders regain command and initiate a turnaround. The initial possible buffer region emerges near the 1.2600 mark. Additional declines beyond this point might pave the way for a slide eyeing the trend line supports around the 200 D-SMA. That has been placed around 1.2570 area.
