Last week, the latest U.S. non-farm payroll report presented a mixed economic signal, indicating an impending upward trend. This strengthened the market's expectation that the Federal Reserve might soon begin to lower interest rates. The upward trend in tech stocks also took a temporary pause, and the U.S. dollar showed signs of weakness over multiple consecutive trading days. Meanwhile, the price of gold surged to a historic high, with spot gold experiencing a rapid increase of 4.57% last week, marking the largest weekly gain since mid-October of the previous year.

In the forex market, the U.S. dollar index fell for the sixth consecutive trading day last week, accumulating a 1.07% decline. The euro against the dollar saw a cumulative increase of over 0.89% this week, while the pound against the dollar rose by 1.58%, and the Australian dollar against the dollar increased by 1.60%. The dollar against the yen depreciated by 2.00% this week.

Last week, the market remained largely flat. Gold saw the largest increase, reaching a historic high of $2195 per ounce. Investors suddenly flocked to this traditional inflation hedge and safe-haven asset, coinciding with the decline in yields from the previous week. Silver, on the other hand, surged by 5.11% last week, reaching a high point for the year of 24.63%.

WTI crude oil spot prices fell by nearly 2.40%, closing at $77.36 per barrel. Despite the extension of production cuts by OPEC+, market concerns about oil demand persisted. Brent crude oil futures for May fell by $0.88, a decline of over 1.06%, closing at $82.08 per barrel.

In the U.S. stock market, all three major indices recorded losses last week, with the Dow Jones Industrial Average falling by 0.93%, marking its largest weekly decline since October 2023. The S&P 500 index dropped by 0.26%, while the Nasdaq declined by 1.17%.

Following disappointing U.S. employment data compared to expectations, there was a sudden increase in the unemployment rate, leading to gradual revisions of previous data. U.S. two-year Treasury yields reached approximately 4.56%, recovering most of their losses but hitting a new trading day and monthly low point. U.S. Treasury yields continued to decline, with the 10-year Treasury yield dropping to 4.044%, the lowest level since February 2nd.

Last week, market bets on consecutive interest rate cuts by the Federal Reserve in 2024 stimulated demand for Bitcoin, which remained above $68,000. Additionally, Coinbase's stock price has risen by over 60% this year, marking its first decline after reaching its IPO price in two years.

In the U.S., last week's so-called "Super Tuesday" confirmed that the November presidential election is likely to be a rematch between Biden and Trump after Republican Nikki Haley formally withdrew from the race. Federal Reserve Chairman Powell's overall message in last week's congressional testimony focused on patience and detail regarding inflation prospects. Despite recent data not supporting it, Powell remains confident in the progress towards inflation and indicates that the Fed is not far from having confidence in interest rate cuts. The market still expects the Fed to begin cutting rates in May.

Turning to Europe, the European Central Bank announced last Thursday that it would maintain interest rates unchanged but revised its inflation and economic growth forecasts, stating that discussions on lifting restrictive policies later this year have begun internally. Ten-year government bond yields in Germany, Italy, and France began to recover. During the press conference, ECB President Lagarde provided clear guidance on rate cuts in June, emphasizing the need for more data before making decisions. However, she mentioned there would be more news in April. The market doubts whether the data to be announced just before the meeting on April 11th will be enough to change this view, and still expects the ECB to make its first rate cut in June.

Regarding Japan, several sources familiar with the Bank of Japan's internal discussions revealed that more policymakers are beginning to accept the idea of ending negative interest rate policies by the end of the month, as they anticipate Japanese companies committing to significant wage increases in annual salary negotiations. The sources also suggest that after ending negative interest rates, the Bank of Japan may overhaul its massive stimulus program, including its Yield Curve Control (YCC) policy. The yen surged against the dollar by over 2%, marking its largest weekly gain since July of the previous year, reaching a high point of 146.48 in over a month.

China announced a 5% official GDP growth target for this year. While this declaration was expected, the lack of stimulating signals in the "work report" clearly disappointed the market. On a more positive note, trade data released on Thursday confirmed a significant rebound in exports and imports compared to the same period last year. These signals align with the market's view that the Chinese economy will "barely pass," and the global industrial cycle will gradually recover.

In geopolitics, ceasefire negotiations between Hamas and Israel did not yield breakthroughs. Israel threatened to attack Rafah before March 10th if hostages were not released. Failure in negotiations and a potential Israeli attack on Rafah would signify another escalation in conflict and increase the risk of retaliation by Iran-backed militant groups in the region.

Outlook for the week:

This week will see a series of U.S. data releases, including CPI, retail sales, and industrial production—though the market expects these data to have no significant impact on the Federal Reserve's decisions. In the eurozone, surveys may indicate weak industrial production data. In the UK, the Bank of England will closely monitor wage growth.

In the U.S., inflation may gradually subside from last month, with retail sales showing signs of recovery, which might lead the Federal Reserve to be less eager to cut interest rates. This aligns with Federal Reserve Chairman Powell's testimony before Congress last week, where he stated that although a rate cut "at some point" this year might be appropriate, he and his colleagues are not ready yet. This is because the Fed wants to see convincing evidence of inflation approaching their 2% target, based on another indicator—the Personal Consumption Expenditures Price Index (PCE). In addition to the CPI, the government's Producer Price Index will be released next Thursday, which will help formulate the PCE index, to be published after the Federal Reserve's policy meeting on March 19-20. Other U.S. data this week includes February industrial production and the University of Toronto's early March consumer confidence index.

Meanwhile, Canada's national balance sheet data will provide insights into household financial conditions, as high interest rates put pressure on mortgage holders with high debt levels.

Japan's annual wage negotiations, closely watched by the market, will release the results of the major labor union federation Rengo next Friday. Additionally, final fourth-quarter domestic production statistics for Japan will be released next Monday. Adjustments may be made, possibly pulling the country out of technical recession, which would be another indicator for further easing by the Bank of Japan.

Monday's wage data in the UK may still show strong growth rates, causing the Bank of England to remain vigilant. Due to indications of labor market tightness, the Bank of England was recently forced to offer its staff pay raises matching inflation. On Tuesday, monthly GDP data in the UK is expected to increase after the December decline, highlighting the economic slump. The Bank of England will release the Consumer Inflation Expectations Survey next Friday.

In the eurozone, the major report will be on industrial output, which is expected to decline at the beginning of 2024. Meanwhile, after last week's hint from the European Central Bank of rate cuts in June, several ministers will give speeches, including Chief Economist Philip Lane. The institution may announce a currency policy framework adjustment this Wednesday.

Consumer prices in China rose for the first time since August, breaking the continuous contraction pressure facing the world's second-largest economy. China has set its GDP growth this year at 5%, and in the context of falling real estate prices, reducing housing costs can lower China's loss rate and further help consumer spending grow after inflation by 6%.

Elsewhere, Australia will receive NAB Business Conditions Index and household spending data for February.

Important Events:

Tuesday (March 11th): OPEC releases its monthly Oil Market Report; Bank of England Monetary Policy Committee member Mann delivers a speech.

Wednesday (March 12th): EIA releases its monthly Short-Term Energy Outlook report.

Economic Data Overview:

Monday (March 11th): Japan's revised fourth-quarter seasonally adjusted real GDP q/q (%); Japan's revised fourth-quarter seasonally adjusted real GDP annualized q/q (%); China's M2 Money Supply YoY (%); U.S. NFIB Small Business Optimism Index for February.

Tuesday (March 12th): Japan's Producer Price Index (PPI) m/m & y/y (%); Australia's NAB Monthly Business Confidence Index for February; Germany's Consumer Price Index (CPI) YoY Final (%); UK Unemployment Rate for January - ILO Standard (%); U.S. Consumer Price Index (CPI) YoY Non-Seasonally Adjusted for February; U.S. Core CPI YoY Non-Seasonally Adjusted (%).

Wednesday (March 13th): UK GDP m/m (%) for January; UK Industrial Production m/m (%) for January; UK Seasonally Adjusted Trade Balance in Goods (£ billion) for January; U.S. EIA Crude Oil Inventories Change for the week ending March 8th (thousand barrels); U.S. IPSOS Major Consumer Sentiment Index PCSI for March.

Thursday (March 14th): U.S. Initial Jobless Claims for the week ending March 9th (thousand); U.S. Producer Price Index (PPI) YoY for February (%); U.S. Core PPI YoY for February (%); U.S. Retail Sales m/m & y/y for February (%); U.S. Core Retail Sales m/m (%) for February.

Friday (March 15th): Australia's IPSOS Major Consumer Sentiment Index PCSI for March; Germany's Wholesale Price Index m/m & y/y for February (%); U.S. Industrial Production m/m for February (%); U.S. Import Price Index m/m & y/y for February (%); University of Michigan Consumer Sentiment Index Preliminary for March.

DXY Analysis:

Last week, the USD index hit its lowest point since January 15th at 102.35, showing weakness over consecutive trading days. After breaking below the psychological level of 103.00, the index continued its decline to reach 102.35, the lowest level since January 15th. The main drivers behind these trends include Federal Reserve Chairman Jerome Powell's dovish stance and the weak performance of the U.S. labor market in February. Although the non-farm payroll employment figures for February exceeded expectations at 275,000, significantly higher than the expected 200,000, indicating strong job growth, the unemployment rate for February rose to 3.9%, higher than the expected 3.7%. Wage inflation measured by average hourly earnings did not meet expectations, growing by 4.3% year-on-year. Despite the February non-farm payroll report showing a rise in the U.S. unemployment rate and moderate profit slowdown, the market still bets that the easing cycle will begin in June due to concerns about economic slowdown. With economic data settled last week, which was a crucial week, including Challenger Job Cuts, weekly initial jobless claims, and the current employment report, it confirmed that the situation in the U.S. is undergoing a transformation, opening a window of opportunity for the Fed to trigger rate cuts at its next meeting after March.

From a technical perspective, after the release of the U.S. employment report last week, the USD index suffered a significant decline, hitting a low of 102.35, the lowest level in over a month. Subsequently, there was buying interest at the lows, leading to a minor rebound to around 102.70. However, it closed with a long lower shadow doji, indicating stability below 103. The rise in the unemployment rate may be the first signal of a change in the job market, and more pessimistic and negative data will likely emerge in the coming weeks. The USD index is currently in a roaming state, with no significant support near 103. More downside seems inevitable, with the next test likely to be the 102.35 to 102.28 region (61.8% Fibonacci retracement level of 100.61 to 104.96), which is of some key relevance. Once this level is breached, further downside could test 101.55 (78.6% Fibonacci retracement level of 100.61 to 104.96) and the psychological level of 101.00. On the upside, the first recovery points are at 103.28, the 55-day moving average, and 103.30 (38.2% Fibonacci retracement level), with a break above 103.71, the 200-day moving average level.

Looking ahead to this week, the U.S. will release CPI and PPI inflation reports for February, which may reveal whether inflation pressures are readjusting and influence the Fed's policy direction, posing a test to the recent persistently weak USD trend.

Range for the Week:101.55--103.30.

Strategy for the Week:It is suggested to sell the USD index on rallies this week.

WTI Crude Oil 

Despite the continuous decline in the USD, crude oil prices plummeted by over 2.40% last week.

The WTI crude oil prices experienced a drop of more than 2.40% last week, erasing much of the previous week's gains. This was due to ongoing caution in the market regarding crude oil demand despite the extension of production cuts by the OPEC+ alliance. While OPEC+ production cuts and Russian output reductions have slowed exports, supply remains tight. However, demand in some countries appears to be lagging, and the seasonal demand in the United States has not yet kicked in. On the supply side, OPEC+ members, led by Saudi Arabia and Russia, agreed on Sunday to extend the voluntary oil production cuts of 2.2 million barrels per day into the second quarter, providing additional support to the market amid concerns about global economic growth and increases in output outside the organization. Federal Reserve Chairman Jerome Powell's dovish statement last Thursday, indicating that the Fed is "not far" from gaining enough confidence that inflation has sufficiently declined to begin cutting interest rates, drove the USD lower, boosting prices of commodities, including crude oil, priced in USD. The Intercontinental Exchange (ICE) reported on Friday that speculative net long positions in gasoline futures decreased by 6,740 contracts to 57,694 contracts for the week ending March 5th, while speculative net long positions in Brent crude oil futures decreased by 17,976 contracts to 236,805 contracts.

Oil prices are entering a dynamic not seen since 2013, when a significant weakening of the USD opened up space for oil prices to rise to $100. Considering the current rate cuts and dovish stance of the Fed, more upside potential may be on the horizon. Although $100 is still far away, opportunities are increasing. Oil bulls still clearly see more upside potential. However, breaking through $80 (a psychological level) does not seem to happen so quickly, and $84 (61.8% Fibonacci retracement level of 93.94 to 67.94) seems to be the next resistance. The targets thereafter are $88.37 (78.6% Fibonacci retracement level) and $93.94 (last year's September high) as the highest levels. On the downside, the first point of contact offering some support is near $76.06, the 100-day moving average. This is followed by the 14-week moving average at $74.74. Additionally, the key level near $74.07 (23.6% Fibonacci retracement level) suggests limited downside potential and the ability to resist selling pressure.

After experiencing a slump at the beginning of the year, oil prices are starting to recover. With oil prices steadily rising, crude oil bulls are quietly winning, and WTI crude oil is poised to break through the key level of $80 in 2024. Indeed, steady climbs may not attract investors' attention, but the economic exceptionalism, tightening fundamentals, and rapidly increasing oil futures spreads (indicating supply tightness) are strengthening the constructive narrative.

Range for the Week: $74.07—$80.00.

Strategy for the Week: It is advisable to buy WTI crude oil on dips this week.

XAUUSD - Gold price soared to a historic high of $2195 last week.

Following the release of US nonfarm payrolls data, the yield on the 10-year US Treasury bond fell to 4.04%, pushing gold prices to a historic high above $2195.20. The significant slowdown in wage growth and the rise in unemployment rate are expected to prompt market expectations of a Fed interest rate cut at the June policy meeting. Meanwhile, the slowing wage growth and high unemployment rate have increased selling pressure on the US dollar. The US Dollar Index, tracking the USD against six major currencies, has refreshed a seven-week low around 102.35. Last week, after an impressive seven-day rally, which pushed gold prices to a historic high of $2195, the gold market may see some consolidation in the short term; however, the market does not view this as the end of the upward trend for gold. Data has confirmed that the Fed must take some action, and traders have increased their bearish bets on the US dollar index, which is favorable for gold prices. The market believes that the ultimate target for gold price now seems to be $2300, and from a technical standpoint, the rise in gold has started from another base, similar to the seven-day rise/trend similar to past price highs. However, even without an independent catalyst this time, this upward trend should still be respected.

Due to speculative interest continuously selling the US dollar, spot gold touched a historic high of $2195.20 per ounce last week. Gold/USD rose for the seventh consecutive day. Extreme overbought conditions (daily RSI above 84; weekly RSI above 70) suggest a possible bearish correction or consolidation phase in the short term. From a technical standpoint, if this bullish breakthrough continues in the short term, bulls may have more confidence in attacking resistance at $2200 and $2215 (150.0% Fibonacci retracement level of 2081.50 to 1810.50). Despite the constructive technical outlook for gold price, caution is still needed as extreme overbought conditions may lead to short-term reversals in the market. In other words, if bears reappear, all eyes will be on $2145.40 (123.6% Fibonacci retracement level). Below this area, there is a lack of significant support until $2100, increasing the risk of a substantial pullback once breached.

The biggest event risk for gold in the coming week is the Consumer Price Index report for February. From a technical perspective, spot gold is trading around uncharted territory, with the next psychological barrier at $2200. If bulls decide to take a breather, this could trigger a pullback to around $2145–2150.

Range for the Week: 2150.00—2230.00.

Strategy for the Week: Consider buying gold on dips this week.

XAGUSD- Silver price surged to a yearly high of $24.63 last week.

Silver rallied last week amid pressure on the US dollar, surging sharply to around $24.63, marking a weekly gain of 5.11%, the largest weekly increase since November last year. As geopolitical tensions eased, the US dollar faced selling pressure, driving up prices of precious metals, including silver. Silver also hit its highest level this year at $24.63. At the beginning of last week, Lagarde stated at the monetary policy press conference that policymakers are more confident in achieving their goals, but confidence is still not sufficient. More information will be available in April, but even more in June. The European Central Bank will not commit to the speed of future interest rate adjustments. The ECB acknowledges that inflation has cooled, and silver prices briefly dipped to $21.93 before rallying to the yearly high ahead of the weekend.

Silver prices rose last week, reaching a new high of $24.63 since the beginning of the year. If silver prices can hold above $24.00 (psychological level) and $23.92 (50.0% Fibonacci retracement level of 25.92 to 21.93), there is potential for further upward movement towards $24.98 (76.4% Fibonacci retracement level) and $25.00 (psychological level). The next level to watch would be $25.27 (high from July 17th last year). On the other hand, if bears push silver prices below $23.92 (50.0% Fibonacci retracement level of 25.92 to 21.93), silver may decline to $23.51 (180-week moving average), followed by the 65-week moving average at $23.42. Breaking below the latter would expose the low of March 4th at $23.02.

Conclusion for the Week: Silver prices surged to a yearly high ahead of the weekend, driven by a significant rise in gold prices. The target is aimed at last year's high of $26.13.

Range for the Week: $23.02—$25.90.

Strategy for the Week: Consider buying silver on dips this week.

AUD/USD 

The US dollar index continues its decline, fueling a rapid rebound in the Australian dollar against the US dollar.

AUD/USD touched a low of 0.6442 last week, its lowest level since last year, and rebounded in a V-shaped pattern to a high of 0.6667 before the weekend. Recent data from the US Department of Labor showed that non-farm payrolls in the US exceeded expectations, reaching 275,000, higher than the revised down figure of 229,000 from January. Further data emphasized that the labor market is cooling off as the unemployment rate rose from 3.7% to 3.9%, and both monthly and yearly average hourly earnings saw a slight decrease. In addition, data released in Australia this week showed a trade surplus, and the economy grew by 0.2% quarter-on-quarter in the fourth quarter of 2023, lower than the expected 0.3%. Year-on-year, the economy grew by 1.5%, higher than expected but lower than the previous 2.1%. AUD/USD continued its rally, rising to a daily high of 0.6667, while US bond yields edged lower. The yield on the US 10-year benchmark note fell to 4.044%, the lowest level since February 2nd. Meanwhile, the US dollar index continued to decline, possibly falling to an eight-week low, fueling a sharp rise in AUD/USD by over 200 pips.

On the weekly chart, after AUD/USD broke above 0.6600 last week, it opened the door for further upside, with the Relative Strength Index (RSI) rebounding into positive territory (52.50). If the bulls extend the uptrend beyond 0.6656 (50.0% Fibonacci retracement level of 0.6871 to 0.6442) and above 0.6667 (last week's high), it could test the levels around 0.6700 (psychological level) and 0.6707 (61.8% Fibonacci retracement level). Further challenges towards the high of January 5th at 0.6747 could follow, then aiming for the key level of 0.6800. On the other hand, AUD/USD formed a bearish Death Cross pattern last week. If it retraces below 0.6600 (psychological level), it could intensify the test of 0.6560 (200-day moving average and last Thursday's low). The next level to watch would be 0.6500 (psychological level).

Conclusion for the Week: AUD/USD formed a bearish Death Cross pattern last week. If it retraces below 0.6600 (psychological level), it could intensify the test of 0.6560 and 0.6500.

Range for the Week: 0.6560-0.6706.

Strategy for the Week: Consider selling AUD/USD on rallies this week.

USD/JPY 

The yen is currently on the verge of a strong recovery.

Last week, USD/JPY plummeted by over 2%, marking its largest weekly decline since July last year, and reached a low of 146.48, its lowest level in over a month. This was driven by speculation in the market that the Federal Reserve may be more confident in achieving the 2.0% inflation target and may start reducing borrowing costs. The February jobs report showed a surge in the unemployment rate to its highest level in two years, exacerbating the weak performance of the US dollar before the weekend. This raised concerns among investors about potential cracks in the US labor market. However, the main factor behind the retreat of USD/JPY may be the leaked news that the Bank of Japan is enthusiastic about ending negative interest rates at its March meeting due to expectations of significant wage increases in the annual wage negotiations between unions this year. With this moment approaching, the yen may be on the verge of a strong recovery. Although the outlook for USD/JPY is starting to dim, its fate in the near term has not been decided yet.

On the weekly chart, USD/JPY retreated further below 150.00 (psychological level) last week after failing to break above 150.45 (a trendline extending from the November high of 151.94) and continued to break below the support level of 148.11 (10-week moving average), reaching a low of 146.48, its lowest level in over a month. If this breakout continues, the next key bottom to watch for will appear at 145.56 (50.0% Fibonacci retracement level of 140.24 to 150.88), followed by 144.10, the 50-week moving average. On the other hand, if buyers return and unexpectedly trigger a bullish reversal, the first resistance level will be at 148.11 (10-week moving average). If the upward momentum persists, market attention may turn to 149.20 (last week's low), followed by the psychological level of 150.00.

Conclusion for the Week: USD/JPY plummeted to 147.00 last week due to hawkish bets on the Bank of Japan raising interest rates, coupled with firm expectations of a June rate cut by the Federal Reserve, leading to a weakening US dollar and a strengthening yen. If the aforementioned news is confirmed, there is a possibility that the currency pair could fall to the 140.00 level in the short term.

Range for the Week: 144.10-149.20.

Strategy for the Week: Consider selling USD/JPY on rallies this week.

GBP/USD:

GBP/USD rose to a level just below 1.2900, a high not seen in over eight months.

GBP/USD appears to be starting the week at a level not seen in over seven months, as expectations of interest rate cuts are weighing on it. Federal Reserve Chairman Jerome Powell stated that the central bank is "not far" from considering lowering borrowing costs since early 2022 to combat the soaring inflation. The latest US labor market data showed a slight slowdown in wage growth and a slight increase in the unemployment rate, causing GBP/USD, as well as most other major currency pairs, to rise against the US dollar. Consequently, the US dollar weakened overall. Meanwhile, the UK, after seemingly experiencing mild contraction in the second half of last year, is likely to have recovered to somewhat less encouraging growth. The pound also received some support from the UK's Spring Budget. Trading cues for the upcoming week may be dominated by the US, with official inflation, retail sales, and consumer confidence data set to be released. However, the UK will release monthly GDP data on Wednesday, with employment data due the day before. The pound currently appears somewhat overextended, and although a significant pullback may not occur in the coming week, some consolidation would not be surprising.

GBP/USD has broken free from the extensive and fairly high trading range that has restricted it since late November 2023. The pound currently seems to be capped by psychological resistance at 1.3000, a level not seen since July last year. In recent days of trading, GBP/USD has easily risen above the downward trendline since mid-July, which is now providing support at 1.2705. Nevertheless, the pound is starting to look quite overbought (daily RSI at 71.50), and some consolidation may occur nonetheless. Key short-term support is provided by 1.2800 (psychological level) and 1.2799 (last Friday's low), while the downward trendline since mid-July at 1.2705 and the 55-day moving average at 1.2680 may become major support focal points. If GBP/USD successfully clears the obstacle of the 180-week moving average at 1.2866 and confirms it as support, then 1.2900 (psychological level) may be seen as the next resistance before 1.2940 (static level since August 2023). The next level to watch would be the 1.3000 (psychological level).

Conclusion for the Week: The pound currently appears somewhat overextended, and although a significant pullback may not occur in the coming week, some consolidation would not be surprising.

Range for the Week: 1.2750—1.3000.

Strategy for the Week: Consider buying the pound on dips this week.

EUR/USD

EUR/USD rose to a high of 1.0982, the highest level in three months.

Last week, EUR/USD rose following the release of US non-farm payroll data, reaching a three-month high of 1.0982. Prior to this, the US non-farm payroll data showed subdued wage data, an unexpected rise in the unemployment rate in February, and an unexpected decline in average hourly earnings. The data indicated minimal inflationary pressure from wages and a low unemployment rate, which may prompt the Federal Reserve to bring forward interest rate cuts to earlier this year. Lower interest rates are detrimental to the US dollar as they reduce inflows of foreign capital. On the other hand, François Villeroy de Galhau, Governor of the Bank of France and member of the ECB's Governing Council, stated that a rate cut in the spring is "very likely" and added that "spring goes from April to June." Meanwhile, Joachim Nagel, President of the Bundesbank, stated, "We are seeing an increasing possibility of rate cuts before the summer break," adding, "This will depend on the data, but the outlook is promising." EUR/USD subsequently edged lower and then rebounded. Overall, EUR/USD is in a short-term uptrend, driven by the prospect of the Federal Reserve being closer to interest rate cuts than the European Central Bank.

EUR/USD effectively rebounded above the 200-day moving average (currently at 1.0833) early last week and then rallied strongly, reaching a three-month high of 1.0982. The weekly chart's Relative Strength Index (RSI) has slightly risen to the 56.20 area, indicating that there is still room for further upside in this currency pair. Currently, the psychological resistance level of 1.10 seems to be a tricky issue for EUR bulls, as bears are approaching this level. The current broad near-term resistance levels are 1.0982 (last week's high). Once bulls break through 1.0982 and 1.1000 (160-week moving average), the pair could swiftly rise to 1.1139 (high from December last year). In case of a reversal in EUR/USD, the pair may find support around 1.0864 (38.2% Fibonacci retracement level of the rally from 1.1139 to 1.0694), and a break below that could target 1.0811 (65-week moving average).

Conclusion for the Week: Overall, EUR/USD is in a short-term uptrend, driven by the prospect of the Federal Reserve being closer to interest rate cuts than the European Central Bank.

Range for the Week: 1.0811—1.1050

Strategy for the Week: Consider buying the euro on dips this week.

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