Spreads
Spreads
Spreads
Spreads
Spreads
EURUSD (4-Hour Chart)
The EURUSD trimmed gains but held above the critical short-term support level following the release of the ISM Manufacturing PMI, which boosted the US Dollar across the board. Data released in the US showed activity in the Manufacturing sector contracted again in February with the ISM PMI rising from 47.4 to 47.7 (below 50 marks contraction), against a market consensus of 48. The inflation indicators of the ISM report pushed Treasury yields to the upside. The US 10-year bond yield reached 4% for the first time since November. In the Eurozone, the preliminary estimate of the German Harmonized Index of Consumer Prices (HICP) rose at an annualized pace of 9.3% in February, hotter than the previous 9.2% and the 9% anticipated by market players. The news pushed the Euro further up, meaning the ECB could take an even more aggressive stance.
From a technical perspective, the four-hour RSI indicator rallied dramatically to 60 figures as of writing, suggesting that the pair was surrounded by strong bullish momentum. As for the Bollinger Bands, the pair was pricing around the upper band and the size between the upper and lower bands get larger, showing the pair was amid strong positive traction and more favored to the upside path.
Resistance: 1.0788, 1.0929
Support: 1.0508, 1.0400
XAUUSD (4-Hour Chart)
The XAUUSD extended its rally on Wednesday and tried to challenge the $1840 mark in the American trading session despite tepid US macroeconomic figures helping the greenback. Market participants have been moving away from the US Dollar these days amid positive news affecting its major rivals as well as some tepid data. Earlier, the US released the February ISM Manufacturing PMI, which resulted at 47.7, barely improving from the previous 47.4 and missing the expected 48. The survey further showed that “new order rates remain sluggish due to buyer and supplier disagreements regarding price levels and delivery lead times,” indicating persistent price pressures. The report triggered a run to safety, which benefited the safe-haven greenback, however, not for long. Apart from this, the 10-year Treasury note is currently at around 4.0%, and the 2-year note yield hovering near a 16-year high of 4.904%.
From the technical perspective, the four-hour scale RSI indicator edged higher further, showing the upside traction surrounding gold is still strong. As for the Bollinger Bands, the pair was continuing trading along with the upper band and the gap between the upper and lower bands get larger, indicating that the pair’s upside momentum would persist in the near term.
Resistance: 1850, 1870, 1900
Support: 1820, 1800
