EURUSD
- EUR/USD rose 0.1% to 1.1056, reaching a fresh one-year high after German consumer prices remained elevated, suggesting that the ECB may continue to hike interest rates for longer than the Fed.
- Governing Council member Pierre Wunsch said that the ECB needs to keep raising interest rates, and market expectations of another 75 basis points of increases were reasonable.
- The US dollar went down to a one-year low in early European trade on Friday on expectations that cooler-than-expected inflation data will result in an early end to the Federal Reserve's rate hikes.
- On Friday, the March retail sales release is expected to show a monthly contraction of 0.4%, the same as the prior month, as consumers struggle with inflation cutting into their disposable income. Preliminary University of Michigan Consumer Sentiment is also due later today.
| SMA (1D) | Rising |
|
|
| RSI (1D) | Rising |
|
|
| MACD (1D) | Slightly Rising |
|
Closing statement: EUR/USD rose to a fresh one-year high on the back of elevated German consumer prices, while the US dollar went down to a one-year low on expectations of an early end to the Federal Reserve's rate hikes. More economic data is expected today, including the March retail sales release and preliminary University of Michigan Consumer Sentiment, which could provide further insight into the health of the US economy.
GBPUSD
- GBP/USD rose 0.1% to 1.2535, hitting a 10-month high, with the Bank of England expected to raise rates again in May.
- U.K. inflation remained in double digits, having accelerated to 10.4% in February.
- Key resistance levels on the way up are around 1.2769 on the 61.8% Fibonacci level traced back from June 2021 highs.
- The DXY, which tracks the dollar against six other currencies, traded 0.2% lower at 100.515, trading at levels last seen in April last year.
- The dollar losses followed the release of the March U.S. producer prices index, which fell 0.5% from a month earlier, the biggest drop since the start of the pandemic.
| SMA (1D) | Rising |
|
|
| RSI (1D) | Slightly Falling |
| |
| MACD (1D) | Neutral |
Closing statement: GBP/USD is trading at a 10-month high, as the Bank of England is expected to raise interest rates again in May, and U.K. inflation remains elevated. The dollar weakened following the release of lower-than-expected producer prices data from the U.S., pushing the DXY to levels not seen since April 2020.
GOLD
- Gold prices rose for a fourth straight session on Friday due to signs of easing U.S. inflation and safe haven demand amid fears of a 2023 recession.
- Gold has been steadily increasing for the last two months, with targets set on the highs from August 2020 and March 2022.
- The U.S. PPI showed signs of slowing down, with an annual basis rise of 2.7%, the smallest gain in over two years. The core PPI also fell 0.1% from February and rose 3.4% from a year ago, excluding volatile food and energy components.
- The Federal Reserve is still expected to raise interest rates next month, likely by just 25 basis points, but there are growing expectations that they will cut interest rates before the end of the year.
Closing statement: Gold has been performing well due to its safe haven demand amid ongoing economic uncertainty and concerns over rising inflation. While the Federal Reserve is expected to continue raising interest rates for now, the possibility of rate cuts later in the year could further support gold prices. Investors will be closely watching economic data releases and central bank meetings to assess the outlook for gold.
CRUDE OIL
- Crude oil prices rose slightly in early Asian trade on Friday.
- Signs of increasing demand in China helped markets look past an OPEC warning on potential headwinds.
- China’s oil imports jumped over 22% in March to their highest level since June 2020.
- Crude oil fell over 1% on Thursday after the OPEC warned that markets were not as tight as they were a year ago.
- Weakness in the dollar aided commodities priced in the greenback.
- Markets also began pricing in an increased possibility that the Federal Reserve will pause its rate hike cycle by June.
| SMA (1D) | Rising |
|
|
| RSI (1D) | Slightly Falling |
| |
| MACD (1D) | Slightly Rising |
|
Closing statement: Overall, crude oil prices are on track for a fourth straight positive week, driven by tightening supply, increasing demand in China, and the weaker dollar, despite some concerns from OPEC about market conditions.
DAX
- The DAX40 is currently overbought, but the break of resistance suggests a possible target of 16300 from historical highs.
- Germany stocks closed higher on Thursday, with gains in Retail, Technology, and Food & Beverages sectors leading shares higher.
- Merck KGaA, Zalando SE, and Infineon Technologies AG NA O.N. were among the best performers of the session on the DAX.
- Covestro AG, BASF SE NA O.N., and Deutsche Bank AG NA O.N. were among the worst performers of the session.
| SMA (1D) | Slightly Rising |
|
| RSI (1D) | Slightly Rising |
|
| MACD (1D) | Slightly Rising |
|
Closing statement: The DAX40 closed higher on Thursday, led by gains in the Retail, Technology, and Food & Beverages sectors. While the index is currently looking overbought, the break of resistance suggests a possible target of 16300 from historical highs. Merck KGaA, Zalando SE, and Infineon Technologies AG were among the best performers of the session, while Covestro AG, BASF SE NA O.N., and Deutsche Bank AG NA O.N. were among the worst performers.