Talking Points:
- EUR/USD Rebound Mired by ECB Easing Cycle- Bearish Momentum Remains in Play.
- AUD/USD Range Vulnerable to Dovish RBA, Dismal 4Q GDP Report.
- USDOLLAR Topside Targets Favored Ahead of NFPs as Bearish Momentum Falters.
For more updates, sign up for David's e-mail distribution list.
Chart - Created Using FXCM Marketscope 2.0
- Looks as though EUR/USD will continue to close above 1.1185 (23.6% expansion) to 1.1210 (61.8% retracement), but will retain the approach to ‘sell-bounces’ in EUR/USD as the Relative Strength Index (RSI) retains the bearish momentum.
- Updated forecasts along with the forward-guidance for monetary policy will be largely in focus as the European Central Bank (ECB) prepares to launch its quantitative-easing (QE) program.
- DailyFX Speculative Sentiment Index (SSI) shows retail crowd has flipped back to net-short EUR/USD going into the end of the month, with the ratio currently holding at -1.02.
AUD/USD
- AUD/USD looks poised to retain the range-bounce action ahead of the Reserve Bank of Australia (RBA) interest rate decision on March 3 amid the string of closes above 0.7780 (23.6% retracement).
- Seeing mixed speculation for a further reduction in borrowing-costs as 18 of the 29 economists polled forecast a 25bp rate cut.
- With the near-term bullish RSI momentum in play, key topside level of interest comes in around former support at 0.8020 (38.2% expansion) to 0.8040 (61.8% retracement).
Join DailyFX on Demand for Real-Time SSI Updates Across the Majors!
Read More:
USD/JPY Scalp Targets 119.64 Resistance Ahead of GDP
The Weekly Volume Report: USD Pushes Higher But Still Waiting on Volume
USDOLLAR(Ticker: USDollar):
| Index | Last | High | Low | Daily Change (%) | Daily Range (% of ATR) |
|---|---|---|---|---|---|
| DJ-FXCM Dollar Index | 11825.92 | 11834.09 | 11803.2 | -0.02 | 56.51% |
Chart - Created Using FXCM Marketscope 2.0
- Dow Jones-FXCM U.S. Dollar outlook remains bullish going into March as it retains the upward trending channel carried over from July 2014; topside targets favored following break of bearish RSI momentum.
- The stronger-than-expected 4Q GDP print may fuel expectations for a very robust Non-Farm Payrolls (NFP) report, but we will keep a close eye on the wage growth figures especially as the Fed remains in no rush to normalize monetary policy.
- Still favor the approach to ‘buy dips’ in USDOLLAR, with the next topside target coming in around 11,901 (78.6% expansion).
Join DailyFX on Demand for Real-Time SSI Updates!
| Release | GMT | Expected | Actual |
|---|---|---|---|
| Gross Domestic Product (Annualized) (QoQ) (4Q S) | 13:30 | 2.0% | 2.2% |
| Personal Consumption (4Q S) | 13:30 | 4.3% | 4.2% |
| GDP Price Index (4Q S) | 13:30 | 0.0% | 0.1% |
| Core Personal Consumption Expenditure (4Q S) | 13:30 | 1.1% | 1.1% |
| ISM Milwaukee (FEB) | 14:00 | 54.00 | 50.32 |
| Chicago Purchasing Manger Survey (FEB) | 14:45 | 58.0 | 45.8 |
| Pending Home Sales (MoM) (JAN) | 15:00 | 2.0% | 1.7% |
| Pending Home Sales n.s.a (YoY) (JAN) | 15:00 | 8.7% | 6.5% |
| U. of Michigan Sentiment (FEB F) | 15:00 | 94.0 | 95.4 |
Click Here for the DailyFX Calendar
--- Written by David Song, Currency Analyst
To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.
To be added to David's e-mail distribution list, please follow this link.
Trade Alongsidethe DailyFX Team on DailyFX on Demand
Looking to use the DailyFX Trade Signals LIVE? Check out Mirror Trader.
New to FX? Watch this Video
Join us to discuss the outlook for the major currencies on the DailyFXForums
