18 March 2021 Morning Session Analysis
Dollar plunged amid dovish statement from Federal Reserve.
The dollar index which gauges its value against a basket of six major currencies failed to extend its rally while being threw-off by market participants tremendously as Federal Reserve reiterated their view of no rate hikes in next two years. After the two days meeting, Federal Reserve decided to remain its interest rate unchanged near zero while maintaining its asset purchase program at $120 billion bonds a month. Besides, Federal Reserve also projected a significant jump for economic growth and inflation as Covid-19 crisis winds down, where forecasting the US economy growing at 6.5% this year and unemployment rate fall from previous estimates of 5.0% to 4.5% before the end of year 2021. Other than that, the central bank also sees the inflation to run at 2.4% this year, far above its previous forecast at 1.8%. The improvement of economic health in US economy has shifted the US central bank’s view with regards to the future economic outlook, becoming more optimistic amid the progress of vaccination program and the recent laid out of $1.9 trillion stimulus plan. Nonetheless, Federal Reserve reaffirmed the market participants that there are no interest rate hikes likely through 2023 despite an improving outlook. As of writing, dollar index dropped by 0.53% to $91.38.
In the commodities market, the crude oil price up by 0.12% to $64.50 per barrel as the International Energy Agency (IEA) revealed their view of estimating no super cycle for oil in near term as supply glut issue remained. Moreover, the EIA has also reported a surprise build of 2.396M barrel as of last week, slightly lower than the economist forecast at 2.964M, yet still increased the market worries over the equilibrium of oil market. Besides, the gold price rose by 0.20% to $1748.80 a troy ounce amid dovish stance from the Federal Reserve pushed up the demand of safe-haven asset.
Today’s Holiday Market Close
Time Market Event
N/A
Today’s Highlight Events
Time Market Event
16:00 EUR ECB President Lagarde Speaks
20:00 GBP BoE MPC Meeting Minutes
Today’s Highlight Economic Data
| Time | Nation & Data | Previous | Forecast | Actual |
| 20:00 | GBP – BoE Interest Rate Decision (Mar) | 0.10% | 0.10% | – |
| 20:30 | USD – Initial Jobless Claims | 712K | 700K | – |
| 20:30 | USD – Philadephia Fed Manufacturing Index (Mar) | 23.1 | 23.0 | – |
Technical Analysis
DOLLAR_INDX, H4: Dollar index was traded lower following prior breakout below the previous support level at 91.55. MACD which illustrated bearish bias momentum suggest the index to extend its losses toward the support level at 91.25.
Resistance level: 91.55, 92.10
Support level: 91.25, 90.90
GBPUSD, H4: GBPUSD was traded higher following prior rebound from the support level at 1.3845. MACD which illustrated bullish bia momentum suggest the pair to extend its gains toward the resistance level at 1.3990.
Resistance level: 1.3990, 1.4085
Support level: 1.3945, 1.3845
EURUSD, H4: EURUSD was traded higher following prior breakout above the previous resistance level at 1.1950. MACD which illustrated bullish bias momentum suggest the pair to extend its gains toward the resistance level at 1.2025.
Resistance level: 1.2025, 1.2105
Support level: 1.1950, 1.1890
USDJPY, H4: USDJPY was traded lower following prior retracement from the resistance level at 109.15. MACD which illustrated bearish bias momentum signal suggest the pair to extend its losses toward the lower level.
Resistance level: 109.15, 109.65
Support level: 108.35, 107.85
AUDUSD, H4: AUDUSD was traded higher following prior breakout above the previous resistance level at 0.7780. MACD which illustrated bullish bias momentum suggest the pair to extend its gains toward the resistance level at 0.7835.
Resistance level: 0.7835, 0.7900
Support level: 0.7780, 0.7730
NZDUSD, H4: NZDUSD was traded higher following prior breakout above the previous resistance level at 0.7225. MACD which illustrated bullish bias momentum suggests the pair to extend its gains toward the resistance level at 0.7290.
Resistance level: 0.7290, 0.7335
Support level: 0.7225, 0.7175
USDCAD, H4: USDCAD was traded lower following prior breakout below the previous support level at 1.2400. MACD which illustrate bearish momentum signal suggest the pair to extend its losses toward the support level at 1.2340.
Resistance level: 1.2400, 1.2485
Support level: 1.2345, 1.2255
USDCHF, H4: USDCHF was traded lower while currently testing the support level at 0.9225. MACD which illustrated bearish bias momentum suggest the pair to extend its losses after it successfully breakout below the support level.
Resistance level: 0.9280, 0.9370
Support level: 0.9225, 0.9180
CrudeOIL, H4: Crude oil price was traded higher while currently testing the resistance level at 64.55. MACD which illustrated diminishing bearish momentum suggest the commodity to extend its gains after it successfully breakout above the resistance level.
Resistance level: 64.55, 66.10
Support level: 63.70, 62.60
GOLD_, H4: Gold price was traded higher following prior breakout above the previous resistance level at 1738.10. MACD which illustrated bullish bias momentum signal suggest the commodity to extend its gains toward the resistance level at 1765.20.
Resistance level: 1765.20, 1786.55
Support level: 1738.10, 1718.15