The release of U.S. PPI and retail sales data on Thursday is poised to capture the market's focus and potentially ignite volatility, as both macroeconomic reports may influence the Fed’s monetary policy outlook.
We’ll gain greater clarity on broader price trends and the health of the U.S. consumer tomorrow with the release of February's PPI and retail sales figures. Another upside surprise in the macro numbers could lead to the realization thatrisks and the strength of the economy have been underestimated, triggering a hawkish repricing of interest rate expectations. This should be bullish for the U.S. dollar.EUR/USD has climbed sharply this month, taking out critical levels during the rally.
Conversely, if sellers return to the charge and trigger a bearish reversal, support can be spotted at 1.0890, followed by 1.0850, an area where three key moving averages converge. Further losses from this point forward will bring the spotlight on 1.0790.USD/JPY ticked up on Wednesday, consolidating above resistance at 147.50. If prices manage to remain above this threshold in the near term, we could soon see a move towards the 50-day simple moving average at 148.35.
On the other hand, if selling pressure remerges and sparks a pullback beneath 147.50, the pair may gradually retreat towards a confluence support region ranging from 146.30 to 146.00. Below this floor, market scrutiny will be directed towards the psychological 145.00 level.Leveraged trading in foreign currency or off-exchange products on margin carries significant risk and may not be suitable for all investors.
We recommend that you seek independent advice and ensure you fully understand the risks involved before trading. Information presented by DailyFX Limited should be construed as market commentary, merely observing economical, political and market conditions. This information is made available for informational purposes only. It is not a solicitation or a recommendation to trade derivatives contracts or securities and should not be construed or interpreted as financial advice.
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