USDX (USD Index)
U.S dollar index is at the tipping point after closed higher on the previous day. The upward movement of the index caused by Jerome Powell testimony which outlines possible four rate-hikes this year. Initially, the market expects three rate-hike this year after December Fed meeting.
The index currently sits near the resistance channel and top of the previous downward movement. Will we see a breakout higher?
News to watch
08.30 AM U.S Prelim GDP q/q, forecast 2.5% increase.
10.30 AM U.S Crude Oil Inventories, estimate a surplus of 2.4 million barrels.
For full outlook for this week, you can follow Forex Outlook For The Week 26 – 2 Mar 2018
Technical Analysis
EUR/USD
EUR/USD tumbled below 1.2300 as U.S dollar index advance on hope The Fed will increase interest-rate four times this year. The pair is at a critical level, and looks will test the previous extreme low. If the low around 1.2200 broken, then we will see a continuation of downtrend to 1.2070.
Today critical level to watch:
Support: 1.2200, 1.2100
Resistance: 1.2300, 1.2500
GBP/USD
The pair broke below the triangle pattern but recovered by the end of the day. There is no confirmed breakout yet, and traders could continue observing the pair movement inside the triangle.
Today critical level to watch:
Support: 1.3850, 1.3800, 1.3600
Resistance: 1.4000, 1.4250, 1.4325
USD/JPY
USD/JPY boosted by U.S dollar index strength in the previous day but stay below 107.40. The pair has not break outside of the triangle shown on the daily chart. The best action to take for now is staying sideway with bullish bias following the U.S dollar index fundamental strength.
Today critical level to watch:
Support: 107.00, 106.10, 105.50, 105.00
Resistance: 107.40, 109.00
AUD/USD
AUD/USD broke below 0.7800, and today the pair is testing the SMA 200. Following the technical play, traders might want to look for long position near the daily SMA 200 with a tight stop below it. However, from fundamental side, the strength of U.S dollar index might bring more weakness for AUD/USD.
Today critical level to watch:
Support: 0.7750
Resistance: 0.7800, 0.7875, 0.7970