Market Overview
- The forex market experienced a mixed day, with major currency pairs and Gold showing significant movements.
- The EUR/USD pair traded near its daily high at 1.0830, reflecting investor interest in the euro despite mixed oscillator signals.
- Safe-haven assets like Gold are attracting traders as the US Dollar Index dips below 104.00 ahead of reciprocal tariffs, pushing Gold to a new all-time high at $3,086.
- Global equities are on a downward trend, with US futures indicating losses amid market uncertainty.
- The US Dollar is losing ground as traders shift their focus to precious metals.
Fundamental Analysis
- Major economic data includes the US PCE and University of Michigan numbers, which contributed to a sell-off in equities.
- The US Core PCE rose to 2.8%, reinforcing Fed's inflation concerns and limiting GBP/USD upside near 1.2967.
- UK Retail Sales exceeded forecasts, and the economy grew by 0.1% in Q4 2024, providing a boost to the Sterling.
- Market focus is shifting towards key US data: ISM PMI, JOLTs, and next week’s Nonfarm Payrolls report.
- Central bank speakers for the coming week include representatives from the BoE, ECB, and the Fed.
Technical Analysis
- For EUR/USD: Moving averages support bullish momentum with support at 1.0790–1.0810 and resistance at 1.0845.
- For GBP/USD: Despite US inflation concerns and trade war fears, GBP/USD remains firm at 1.2948 with potential for further upside near 1.3000.
- For USD/JPY: The pair climbed for the third consecutive week.
- For Gold (XAU/USD): Gold reached a new all-time high at $3,086 amid market uncertainty and a falling US Dollar Index.
Conclusion
- The forex market is currently characterized by mixed investor sentiment, with safe-haven assets gaining traction amid market uncertainty.
- Traders should keep a close eye on key economic data releases and central bank statements in the coming week.
- The Fed's monetary policy decisions, particularly potential rate adjustments, will significantly impact the strength of the US Dollar.
- Despite some mixed signals, technical indicators suggest a bullish trend for EUR/USD and potential upside for GBP/USD.
