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25 March Forex daily review

Sergiy Zlyvko
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The dollar index DXY closed at the forecasted price level. On weak German statistics and statements by the ECB in relation to the strong euro and its implications for the euro area economy, the rate increased to 80.25 DXY, EURUSD dropped to 1.3750.

On Asian trading session, dollar index is trading at 80.00. Before the end of the Asian session, we expect the growth of the dollar index and then drop to 79.70. We are considering a decline of the dollar from the last two rebounds of euro.

EURUSD yesterday marked 1.3750. After the end of the European session, EURUSD, as on Monday, rebounded from a low by 95 points to 1.3845. Two wanton rebounds of 100 points, makes us consider the impact on the euro to 1.3865. If we’re right with pair’s growth and post-test level of 1.3870, euro will return to 1.3810 mark and on Thursday consider the pair’s falling to 1.3725. Important data from Europe is not expected, so we expected the decline and then growth of the euro to 1.3790 level.

British pound decreased on EURGBP cross-rate and the dollar strengthened to 1.6550. I think GBPUSD is set up and the breakdown of 1.6570 mark will be a signal of sharp increase. Since the pair is undervalued in RSI, the pound before closing of the Asian session is expected to decline to 1.6510 and then rise to 1.6570. GBPUSD all day was trading in a narrow range limited by the resistance level of 1.6510 and the support level of 1.6465. Rushing after EURUSD, the pound rose to 1.6535 mark and then back to 1.6490. This jump of the course does not change the situation, so the risks of decrease of the pair are saved. Nevertheless, a rise above 1.6535 level could weaken the bearish momentum, giving the bulls a chance to test 1.6600.

Australian dollar strengthened against the dollar for four days. Given the behavior of other major pairs, we do not understand the dynamics of AUDUSD. While writing the review, AUDUSD exchange rate reached settlement purposes and is trading at 0.9190. Increase was due to statements made by the RBA head Stevens. If the dollar’s decline will continue, AUDUSD will go to 0.9200.

USDCHF rate touched highest point on Tuesday and returned to 0.8825 level. We inclined to think that the pair will remain in the range of the last two days. Swiss franc was unable last week to continue to grow against the U.S. dollar. The pair found support at 0.8715 and pushed from it, rose to 0.8830 mark and later to 0.8870. The last level yet hold back the tide of bulls on the dollar, but the risks of testing and growth above the 0.8900 level are quite high. On daily timeframe, Parabolic SAR is now below the price chart, which suggests upward trend continue. But to confirm the formation of basic support, the pair should at least get up and consolidate above 0.8930.

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