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Daily Technical Insights 5 May 2023


Make informed decisions with the most up-to-date and reliable financial data, exclusively provided by vtmarkets.com.

EUR/USD (4 Hours)

EUR/USD remains down as the ECB hikes rates and US NFP is in focus.

The EUR/USD pair fell after the ECB meeting due to declining European bond yields and lower US yields affecting the US Dollar’s performance. The ECB announced a 25 basis point hike in interest rates, signaled likely further hikes, and stopped asset purchase program reinvestments from July 2023. Market participants expect two more rate hikes at the next two meetings. The Eurozone will release Retail Sales data for April on Friday, while the US employment report will be the key event.

According to technical analysis, the EUR/USD pair is currently trending lower after a period of upward movement. At present, the price has reached the middle band of the Bollinger band, indicating a consolidation phase. It is expected that the EUR/USD will continue to consolidate and remain within our support and resistance levels. The Relative Strength Index (RSI) is presently at 51, suggesting a neutral trend in the EUR/USD market.

Resistance: 1.1051, 1.1073

Support: 1.1015, 1.0986

XAU/USD (4 Hours)

Gold (XAU/USD) Bulls Hold Strong Ahead of US Nonfarm Payrolls Report.

XAU/USD fell with the Asian opening, but then jumped back to near record highs of $2,078.36 before closing the gap. It has since retreated to around $2,050, supported by falling US Treasury yields which put pressure on the Greenback. The ECB announced a widely anticipated 25 bps hike, with market players rushing to discount at least 2 or 3 more rate hikes. Lagarde confirmed that they are not concerned about the banking situation, and the decision to hike at a slower pace was linked to the crisis. The US employment figures are now in focus, with the market anticipating the April Nonfarm Payrolls report on Friday.

The technical analysis indicates that XAU/USD is still hovering in the high territory, but it has slowed down a bit. The price is currently just below the upper band of the Bollinger Band, indicating the potential for a downward movement. Moreover, the Relative Strength Index (RSI) is currently above 70, indicating that XAU/USD is overbought.

Resistance: $2,068, $2,058

Support: $2,046, $2,033

Make informed decisions with the most up-to-date and reliable financial data, exclusively provided by vtmarkets.com.