The European Central Bank has removed language suggesting rates could be lower than they currently forecast. In addition, he abandoned the promise to end APP “a short time” before rates rise. It also announced a faster liquidation of its asset program. PEPP will still end in March. However, it will now only buy €40bn worth of bonds in April, €30bn worth of bonds in May and €20bn worth of bonds in June. This would effectively end the bond purchase program in the third quarter, rather than the fourth quarter.
Important facts of the week:
- FED Wednesday 3:00 pm EST raises interest rates 0.50bp
- BC UK Thursday 9:00am EST 0.25bp
EURUSD remains under sell pressure below 1.10 levels. Sell is expected below 1.0890 to 1.0870, below 1.0870 to 1.0850. The high potential buyer levels are between the lows of March 7 and 8. Buyers could position themselves above 1.0930 to 1.0950 and 1.10.
GBPUSD below 1.3030 sells hold up to 1.30. Below 1.30 sell pressure would continue until 1.2950 and 1.29. The UK Central Bank will raise its interest rates this Thursday so by then we should not consider sell into the market area at press time. The rise in interest rates may not be good news given the unstable conditions in the region.
USDJPY holds buyer. The market may have positioned itself to prepare for Wednesday’s take profit in conjunction with the Fed. Above 117.50, buyers remain in the market until 117.70 and 117.70. Take profit would be considering positioning below 117.0.
USDCAD below 1.2750 the market could take its gains to 1.2730 and 1.27. Below 1.27 it goes back to the lows of 1.2660. The cross could test the 1.2770 and 1.2780 levels. The levels reached on Wednesday at the close of the American session will give the operating parameters for Wednesday before the FED.
XAUUDS XAGUSD buyer preference. In gold above 1950.0 the strategy remains buying. Take profit levels remain below 2000.0 and 2008.0 however conflict conditions could push buyers through 2020.0 and 2030.0. The rise in the interest rate of the Federal Reserve this Wednesday could also be a reason for the liquidation of the price to go to the dollar as a refuge currency. In silver take profit levels remain at 26.0. The strategy remains buy above 24.0. Silver will follow gold this week and a correction to 24.0 and extensions are expected.