US Dollar Index
The greenback has not moved much for almost half a month and it only surged by 0.25% in the previous week.
The investors in the forex market took a wait and see mode before the FOMC meeting on Wednesday. Therefore, the dollar fluctuated slightly between 91.50 and 92.00 at the beginning of the week.
On Wednesday, Fed Chair Powell said after the meeting that the inflation would climb up to 2.4% within the year temporarily, but the monetary policies would remain unchanged by 2024. His speech led to a higher risk sentiment, so the safe-haven asset like USD dropped significantly.
However, the market calmed down soon and the greenback appreciated before the end of the week, closing above 91.87 finally.
The oil experienced the greatest plummet since the start of year 2021 last week, dropping by over 6.3%.
Although the price stayed in a small range within 63.10 and 66.50 in the first three days, the updates of pandemic in Europe became the catalyst for oil to slump quickly on Thursday. The market was worried about the economic recovery and thus the oil demand outlook attributed to the surge of COVID-19 cases and suspension of the AstraZeneca vaccine in Europe.
Furthermore, the continued appreciation of USD is another factor weighing on the commodity price that dominated in dollars, especially the oil.
Despite a 3.25% rally on Friday, the 7.62% pullback on Thursday could not be offset and the oil had to close the week below 61.50.
Markit PMI (EU & UK)
The March PMI figures of European Union and United Kingdom will be released on the upcoming Wednesday.
Due to the potential third wave of COVID-19 across the continent, the EU members are considering to delay the reopen plan, as well as extending the lockdown and containment measures. The flash March PMI thus can help investors assessing the impact of keeping the measures. The market expects that the manufacturing sector of Germany perform well and its PMI will break 60 level. In contrast, the services sector of the whole EU is unlikely to leave the contraction zone. The EU composite PMI is expected to be 49.1 which is slightly better than that in February (48.8).
The UK economy is forecasted to recover in a faster rate when compared with other European countries thanks to the smoother vaccination course. The services sector which contributes around 80% of GDP will be benefited the most under a rapid vaccination programme, so the services sector is expected to expand (PMI>50) in March.
The WTI crude oil could not extend its gains, making a 6.33% plummet last week, so it has become the worst week since November last year.
In technical aspect, the fast MA and slow MA are converging, and the RSI is very close to 50. In addition, the price is lying around the lower bound of the uptrend channel. Therefore, the outlook for oil price is still undetermined.
The movements in coming few days are decisive for the oil. It will mark an end of the four-month uptrend if the oil price cannot return into the channel. On the contrary, the uptrend will carry on if the price makes a strong rebound within the week.
Support: 63.50, 60.00, 58.50
Resistance: 67.00, 70.00, 72.50, 77.00
The loonie tried to stand firmly above the resistance at 0.8000, but did not succeed, slightly dropping by 0.19% in a week.
Technically, the uptrend channel and the golden cross still hold on the weekly chart, suggesting a bullish bias in the longer run. Nonetheless, the signals are much negative for the short run. In the four-hour chart, the RSI has passed below the 50 mark and the two-line MA has just formed a death cross.
All in all, the CAD keeps challenging the 0.8000 resistance, but the bears are currently dominating the market, so it is difficult for CAD to stand above 0.8000 fast. If the attempts are failed again, the loonie is likely to have a short-term pullback, and the retracement may be resisted by the support around 0.7930.
Support: 0.7930, 0.7840, 0.7740
Resistance: 0.8000, 0.8150, 0.8300
USD Index (D)
The greenback last week confirmed its breakout of the three-month sideways trend as it stood firmly above the 91.50 upper resistance.
From technical perspective, the two-line MA is trying to form a golden cross, and the RSI is located between 50 and 70 intervals, indicating a positive outlook for the USD.
As a result, the bullish momentums in the market can push the greenback to a higher position. However, there is also another resistance at 92.50, so the surge may be resisted at that point. In the coming few days, it is highly possible for the USD to fluctuate between 91.50 and 92.50.
Support: 91.50, 91.00, 90.50, 90.00
Resistance: 92.50, 93.90, 94.75
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