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I’m seeing a couple of top-tier catalysts from the U.S. economy today!

Can the dollar benefit from strong fundamentals and risk-off flows?

Before moving on, ICYMI, yesterday’s watchlist looked at an ascending trend line on NZD/CAD ahead of the BOC decision. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

BOC hiked interest rates from 0.25% to 0.50% as expected

Russian troops entered strategic port of Kherson

ADP non-farm employment change posted 475K gain in Feb, previous reading upgraded

U.S. EIA crude oil inventories slid 2.8M barrels vs. projected 2.5M gain

Japanese automakers to halt shipments to Russia

Fitch downgrades Russia and warns of FX intervention

India considering bilateral rupee-ruble trade to bypass sanctions

Biden administration considering imposing sanctions on India

Australia’s AIG construction index rose from 45.9 to 53.4

New Zealand commodity prices rose 3.9% according to ANZ

Australian building approvals slumped 27.9% vs. projected 2.9% dip

Australia’s trade surplus widened from 8.82B AUD to 12.89B AUD

Chinese Caixin services PMI fell from 51.4 to 50.2 vs. 50.9 forecast

Upcoming Potential Catalysts on the Forex Economic Calendar:

U.S. Challenger job cuts at 12:30 pm GMT
U.S. initial jobless claims at 1:30 pm GMT
Fed head Powell’s speech at 3:00 pm GMT
ISM services PMI at 3:00 pm GMT
BOC Governor Macklem’s speech at 4:30 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: GBP/USD

GBP/USD 1-hour Forex Chart

GBP/USD 1-hour Forex Chart

Cable has been pacing back and forth between resistance at the 1.3435 level and support close to the 1.3300 mark recently.

The pair looks ready to test the top of the range again, and technical indicators are hinting that it might keep gains in check.

For one, the 100 SMA is below the 200 SMA to confirm that bearish pressure is in play. Also, Stochastic has been indicating exhaustion among buyers, so turning lower would mean that sellers are back in the game.

In that case, GBP/USD could make its way back down to the bottom of the range or even attempt a breakdown. If that happens, the pair might be in for a drop that’s the same height as the rectangle or roughly 135 pips.

The safe-haven dollar might be able to regain its footing soon, as worsening tensions between Russia and Ukraine (as well as the developed nations imposing sanctions) are keeping traders on edge.

To top it off, the U.S. currency might also be able to take advantage of strong fundamentals if the ISM services PMI turns out stronger than expected. After all, traders are likely paying close attention to the jobs component to get more clues for Friday’s NFP release.