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24.02.2023 Market Report


EUR/USD seeks clear directions as it seesaws within a 25-pip trading range during early Friday, easing to 1.0600. The major currency pair portrays the market’s anxiety ahead of the key data/events, while also struggling to justify the mixed geopolitical headlines surrounding Ukraine.


GBP/USD picks up bids to reverse the early Asia losses, despite failing to gain traction above 1.2000. That said, the Cable pair seesaws around 1.2020-25 during Friday morning, following a two-day downtrend.


USD/JPY remained in vigorous action in the Asian session as Bank of Japan (BoJ) Governor Nominee Kazuo Ueda delivered his first speech after his selection. The asset displayed wild gyrations in the 70-pips range and returned to its mean. The major has turned sideways as a volatility expansion is generally followed by a contraction in the same. At the time of writing, the pair is demonstrating a back-and-forth action around 134.70 and is expected to continue to remain sideways till the release of the United States Personal Consumption Expenditure (PCE) Price Index for fresh impetus.


AUD/USD braces for the key US data around 0.6825, extending the previous day’s rebound from a seven-week low during early Friday. In doing so, the Aussie pair seems to cheer the latest headlines from China and Japan as they tame the previous risk-off mood. However, fears surrounding Russia and the US-China ties join hawkish Federal Reserve (Fed) concerns to keep a tab on the bulls.


The NZD/USD pair is facing barricades in overstepping the immediate mark of 0.6240 in the Tokyo session. Earlier, the Kiwi asset displayed a solid rebound from 0.6200 as investors shrugged off hawkish Federal Reserve (Fed)-inspired volatility. The asset is likely to remain directionless as investors are awaiting the release of the United States Personal Consumption Expenditure (PCE) Price Index for fresh cues. The US Dollar Index (DXY) is demonstrating signs of volatility contraction amid a mixed market mood. The recovery moves from the risk-sensitive assets are bizarre in comparison with the price action by the USD Index.


The US Dollar was bolstered by yet further evidence of an inflationary theme in the US economy with the strong economic data that continues to suggest the US Federal Reserve’s monetary policy tightening could be extended if it is to bring down the highest inflation in decades.  The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, showing a still-tight labor market and a resilient US economy.


The USD/CHF pair has corrected marginally to near 0.9330 after printing a fresh six-week high around 0.9350 in the early Asian session. The Swiss franc asset is expected to recover sooner as the risk profile is supporting the safe-haven assets. The US Dollar bulls seem in control as the Federal Reserve (Fed) policymakers are reiterating the requirement of more rates by the central bank to bring down inflation to the 2% target.


Oil prices rose on Friday and were close to trading positive for the week as the prospect of deeper-than-expected cuts in Russian supplies largely offset concerns that rising interest rates will dampen demand this year.


Gold price prints mild gains as it consolidates the weekly loss, the fourth one in a row, ahead of the US Fed’s (Fed) preferred inflation gauge. In doing so, the precious metal prints the first daily gains in five while probing the bears at the lowest levels in 2023.

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