Daily Price Outlook

The EUR/USD is currently trading at 1.0646, which is an increase of 0.39% in the last 24 hours. The pair has reached a new high for the day due to the Dollar Index decreasing and the ECB making hawkish statements.

ECB raises interest rates by 50

On Thursday, the European Central Bank (ECB) successfully navigated what some consider to be the early signs of a potential new financial crisis. During her regular news conference, President Christine Lagarde emphasized the need for caution as financial stability risks continue to grow due to the past year's rate increases, which are beginning to expose the weaker components of the financial system.

In addition, the ECB raised its benchmark interest rates by 50 basis points, citing concerns about inflation. Financial markets had anticipated this move, and there were few expectations of a smaller increase.

Despite the interest rate hike, the EUR/USD pair continued to rise as the ECB sought to control rising inflation in the Eurozone. However, the central bank did not provide any hints about future rate increases or the May political move. Financial experts predict that the ECB will likely raise rates further, but the ongoing tensions in the banking industry will be a significant factor.

Finally, on Friday, Eurostat will release the final figure for consumer inflation in the Eurozone.

Fed might remain steady on interest rates

Investors were concerned that the Federal Reserve would reduce the 50 basis point interest rate increase to improve its resilience against prolonged inflation in the United States.

However, weak monthly inflation, a higher unemployment rate, lower Producer Price Index (PPI) statistics, and declining Retail Demand suggested that January's data was an exception. As a result, Fed Chair Jerome Powell would likely continue to raise interest rates by 25 basis points.

In addition to the dropping inflation, new concerns about a global banking collapse have emerged, making it less likely that the Fed would propose an unchanged monetary policy. Consequently, the Federal Reserve may keep interest rates constant after factoring in lower inflation in February and new banking instability.

The Dollar Index has retested its two-day low at 104.11 and may continue to decline as the Fed's interest rate decision is surrounded by growing uncertainty. Meanwhile, the EUR/USD currency pair has benefited from a weaker US dollar.

Looking ahead, Friday's preliminary UoM Inflation Expectations will provide a clear indication of the Fed's interest rate policy since future inflation expectations can become real inflation.

EUR/USD Intraday Technical Levels

Support      Resistance

1.0564          1.0649

1.0515          1.0685

1.0479          1.0734

Pivot Point: 1.0600

EUR/USD – Technical Outlook

The EURUSD pair is currently exhibiting new positive trades in an attempt to surpass the key level of 1.0640 and head towards our next target at 1.0745. As a result, we continue to recommend a bullish trend for the upcoming period, with hopes of positive momentum to help push the price even higher.

However, it's worth noting that failure to breach 1.0640 could lead to a bearish rebound, with the price potentially heading towards testing the critical support level at 1.0515 before attempting to rise again.

Daily Price Outlook

The WTI Crude Oil Futures are trading at 68.42, indicating a 1.20% increase in the last 24 hours. On Thursday, oil prices significantly recovered after hitting their lowest in 15 months the day before.

This occurred as the markets stabilized after Swiss authorities provided Credit Suisse with a financial lifeline, and optimistic forecasts for a Chinese economic boom helped raise expectations for a rise in demand this year.

Optimistic Forecast for China's Economic Growth

Investment bank Goldman Sachs has raised China's annual economic growth forecast from 5.5% to 6%, citing encouraging trends after the nation relaxed most anti-COVID measures earlier this year. The estimate, which exceeds the 5% predicted by the Chinese government, has fuelled optimism that a Chinese rebound could drive oil demand to record highs this year.

In addition, the International Energy Agency's monthly report on Wednesday predicted an increase in oil consumption due to the resumption of air travel and China's economic recovery following the abandonment of its zero-COVID policy. OPEC has also raised its 2023 demand forecast for China.

As a result, oil prices have steadily risen from their lows, with expectations for a strong demand comeback this year.

Swiss Central Bank Provides Financial Lifeline to Credit Suisse

Meanwhile, on Thursday, Credit Suisse announced that it would borrow up to $54 billion from the Swiss central bank to boost its liquidity and regain investor confidence following a decline in its stock price, which raised concerns about a possible global financial crisis.

The news of Credit Suisse's financial lifeline provided some relief to the markets, leading to a recovery in oil prices as market sentiment stabilized.

Dovish Fed Expectations Contribute to Rise in USOIL Prices

US inflation figures indicate a slowdown and economic downturn, leading to predictions of only a 25 basis point increase in the federal funds rate by the Federal Open Market Committee (FOMC) during its March 22 meeting. These dovish expectations resulted in a decline of the US dollar, with DXY currently trading at around 104.43.

Additionally, ongoing volatility in banking stocks and changing interest rate forecasts caused the US 10-Year Treasury Yield to fall to 3.489%. A weak dollar, which makes crude oil cheaper for foreign customers, also contributed to the strengthening of oil prices.

USOIL Intraday Technical Levels

Support      Resistance

65                72

62                76

58                79

Pivot Point: 69

USOIL – Technical Outlook

The price of crude oil has dropped below the $66.00 level, and although there have been some attempts at a recovery (with the price currently testing the $68.00 level), it remains under negative pressure from the EMA50 and is expected to continue declining in the coming trading sessions.

Looking at the chart on a longer time frame, we see that the price has formed a head and shoulders pattern with negative targets that extend down to 48.50 areas initially and 30.15 after surpassing the previous level. However, these levels represent correctional levels for the bullish wave shown on the chart.

Since continuing to rise and break through 69.25 could push the price to make greater gains and test 71.45 before any new decline, we believe that the bearish trend will persist in the short and medium term.

Today's trading range can be between support at $65.70 and resistance at $69.50.

Daily Price Outlook

The GBP/USD is currently trading around 1.2067. Following a sell-off triggered by reports of internal issues at Credit Suisse, the pair attempted a rebound move.

Federal Reserve Rate Hike Bets Lose Steam Amid Falling US Inflation and Credit Suisse Crisis

In the US, concerns about the potential harm caused by the Federal Reserve's aggressive rate hike cycle have grown following the collapse of Silicon Valley Bank (SVB), and bets on rate increases have been muted due to a decrease in inflation to 6%, which was in line with expectations. Market participants now expect the central bank to exercise caution regarding potential hikes, and the CME Group FedWatch Tool shows an 82% chance of a 25 basis point interest rate increase.

Furthermore, disappointing US retail sales and lower Producer Price Index (PPI) numbers suggest a noticeable decline in US inflation, which has significantly reduced hawkish Federal Reserve (Fed) bets.

As a result, the US Dollar Index (DXY) has corrected following the decline in hawkish bets and is currently trading at 104.64, while the US 10-year treasury bond is trading at 3.496%. The GBP/USD currency pair's decline has been limited by the weakening dollar.

UK Chancellor Hunt presents significant tax and benefit reforms in the Spring Budget

Meanwhile, in the United Kingdom, Chancellor of the Exchequer Jeremy Hunt announced significant reforms to the UK tax and benefit system to encourage firms to invest, attract individuals to return to work, and boost the economy out of stagnation.

In addition, Credit Suisse's biggest investor declared it was unable to offer the Swiss bank any more financial support, which prompted the CEO of the Swiss bank to provide new guarantees concerning the stability of the institution's finances. According to the Telegraph, Bank of England (BoE) officials were discussing the possible impact of the issues at Credit Suisse, a systemically important firm linked with the global financial system.

Worries about the European banking system were reinforced by unfortunate news from Swiss lender Credit Suisse, and investors' risk-off sentiment is still on the rise as a result. Therefore, the United Kingdom's Finance Minister (FM) Jeremy Hunt failed to support the British Pound with the financial budget, putting pressure on GBP/USD.

GBP/USD Intraday Technical Levels

Support      Resistance

1.1989         1.2162

1.1913         1.2259

1.1817         1.2335

Pivot Point: 1.2086

GBP/USD – Technical Outlook

The GBP/USD pair made an attempt to break the minor support level at 1.2060, but it consolidated above it, keeping the possibility of resuming the bullish trend on an intraday basis. The next main target is expected to be at 1.2260.

Stochastic is providing clear positive signals, supporting the expectation of a rise in the upcoming sessions. Breaking 1.2145 would make it easier to achieve the anticipated positive targets.

It is important to note that breaking 1.2060 would push the price to decline and test the most significant support at 1.1940 before any new positive attempts.

The expected trading range for today is between 1.2000 support and 1.2160 resistance.

Daily Price Outlook

The XAU/USD is currently trading at 1,910.42, indicating a 0.41% decrease within a day. On Thursday, the price of gold fell from its six-week high as speculators cashed in on gains. However, the yellow metal's status as a safe haven asset was strengthened by fears of an impending financial crisis and uncertainty regarding monetary policy.

Credit Suisse Crisis Sparks Risk Aversion and Impacts Gold Prices

Global market participants are currently concerned about a potential repeat of the 2008 financial crisis as the US banking crisis has now reached Europe and affected Credit Suisse (CS), which is considered to be a bank with significant worldwide systemic importance.

Following the announcement on Wednesday that Credit Suisse's top investor would not provide the Swiss bank with more financial support, global stocks, including Credit Suisse's shares, experienced a decline.

The refusal of the Saudi National Bank to invest additional funds in Credit Suisse led to an acceleration in the leading European bank's Credit Default Swaps (CDS), which then caused a financial market crisis.

Furthermore, news that representatives of the European Central Bank (ECB) approached banks to inquire about their exposure to Credit Suisse only added to the already existing risk-off sentiment.

When the banking crisis spreads to Europe and targets Credit Suisse, investors tend to opt for safe-haven assets like gold, causing the price of XAU/USD to increase. However, as investors began to take profits, gold prices dipped from their six-week high.

Fed Rate Hike Speculations and Their Impact on Gold Prices

Traders showed little interest in US statistics amidst growing concerns about Credit Suisse and the possibility of a new financial crisis.

US retail sales fell by 0.4% in February, below market expectations of 0.3% and a downward revision from the prior month's figure of 3.2%. The Producer Price Index (PPI) also decreased from 5.7% in January to 4.6% YoY, falling short of the market projection of 5.6%.

The data shows a noticeable drop in US inflation, which has lowered expectations of a hawkish stance by the Federal Reserve (Fed). Nevertheless, Reuters reports that the Federal Open Market Committee (FOMC) is still expected to raise the federal funds rate by 25 basis points at its meeting on March 22.

As traders anticipated further Federal Reserve interest rate increases, Treasury rates rose to 3.489%, and the DXY rebounded to 104.57, putting pressure on XAU/USD.

Gold (XAU/USD) Intraday Technical Levels

Support      Resistance

1890            1942

1862            1965

1838            1993

Pivot Point: 1914

Gold (XAU/USD) – Technical Outlook

The gold price encountered substantial resistance at $1,929, trading with clear negativity and retesting the breached resistance for the bullish pennant's pattern, which was influenced by stochastic negativity. Hoping for favorable momentum to help push the price back into the main bullish wave, which has its next objective of $1,962.00.

The EMA50 continues to support the projected bullish trend, and a break of $1,929 is needed to ease the goal of reaching the desired level.

But, breaking $1,906.00 will put the price under extra downward pressure, causing it to test the most significant support at $1,878.80 before any new attempt to rise.

Today's trading range is predicted to be between $1,894.00 support and $1,936.00 resistance.

Daily Price Outlook

The NZD/USD pair is currently trading at 0.6221, which represents a decline of 0.22% over the last 24 hours. The pair retreated as investors became worried ahead of publishing New Zealand's Gross Domestic Product (GDP) data and the US Retail Sales and Manufacturing statistics.

Fed Rate Hikes Speculations

Last week, Jerome Powell, president of the US Federal Reserve, said that the benchmark interest rate would increase earlier than anticipated. He said that interest rates would climb more quickly if there were strong economic statistics. However, given the current issues with the US banking system, traders anticipate a less hawkish central bank since they are concerned that more banks may collapse.

After the US Government, Federal Reserve, and Federal Deposit Insurance Corporation (FDIC) actively insured a rescue for all bank depositors, foreign currencies found relief due to declining rate expectations.

However, investors began to worry about Fed rate increases when the US CPI report revealed that inflation is still a problem.

After the CPI report, Reuters reported that a government analysis revealed that American inflation remained high in February. Therefore, the Federal Reserve may increase its interest rates by 0.25 points the next week and one more in May.

After hearing that the Fed may hike interest rates next week, the US Dollar Index (DXY) received bids to test the 103.76 intraday high. The yield on US Treasury bonds with a 10-year maturity rose to 3.678%. It causes the NZD/USD currency pair to decline.

Traders are waiting for Retail Sales and the Producer Price Index (PPI) later today for further information about the US economy and inflation.

New Zealand Upcoming GDP report

Early this morning, New Zealand's current account results impacted the Kiwi Dollar. The current account deficit decreased from NZ$11.40 billion to NZ$9.46 billion in the fourth quarter.

Traders are now anticipating Statistics New Zealand's GDP report. Estimates indicate that the New Zealand GDP has shrunk by 0.2% after growing by 2.0% in the third quarter.

A slowing of the growth rate shows that household demand is becoming more limited, easing the pressure on Reserve Bank of New Zealand (RBNZ) policymakers working to slow down inflationary pressures. The RBNZ may suspend the cycle of rate hikes if there is a large downward deviation in the GDP. It will be unfavorable to the NZD/USD pair.

NZD/USD Intraday Technical Levels

Support      Resistance

0.6207         0.6256

0.6179         0.6277

0.6158         0.6305

Pivot Point: 0.6228

NZD/USD – Technical Outlook

The NZDUSD pair has resumed its negative trend and is approaching the EMA50. It is expected to decline further towards our next main target at 0.6140. Breaking this level may extend the bearish wave to reach 0.6020.

As such, we maintain a bearish outlook for the upcoming trading sessions, unless the pair breaches 0.6290 and holds above it. The expected trading range for today is between support at 0.6170 and resistance at 0.6280.

Daily Price Outlook

The price of gold, XAU/USD is now trading around 1,903. After dropping from a six-week high in the previous session, gold prices continued to decline on Wednesday as fears over a banking crisis in the country faded, and a mixed figure on US inflation created some confusion over the Federal Reserve's attitude on monetary policy.

Bank Crisis Subsides

In the last few days, the collapse of American banks caused a rush toward safe havens, which caused the price of yellow metal to rise rapidly. However, following the failure of the Silicon Valley Bank, the US government took action to reaffirm public confidence in the banking industry.

The Fed moved quickly to loosen restrictions on bank borrowing. The White House also assured SVB depositors that it would cover withdrawal costs.

Therefore, when concerns about the banking sector spread following the collapse of SVB last week faded, investors surged into stocks in US markets overnight, and gold prices were on edge.

US Inflation has Slowed

Meanwhile, the Consumer Price Index (CPI), which measures inflation in the US, eased. The US CPI and CPI ex Food and Energy met 6.0% and 5.5% YoY market predictions, below 6.4% and 5.6% respective prior readings.

After the CPI report, Reuters said that a government report showed US inflation stayed high in February, and fears of a long-term financial crisis faded. Therefore, the Federal Reserve might raise its benchmark rate by a quarter percentage point next week and again in May.

The US Dollar Index (DXY) picked up bids to retest the intraday high of 103.76 after the news that the Fed might raise its benchmark rate. That puts downward pressure on the price of gold. The yield on 10-year US Treasury bonds increased to 3.678%.

The hawkish Fed wagers and positive US Treasury bond rates enable the US Dollar to maintain its strength and provide XAU/USD bears reason for optimism.

Gold (XAU/USD) Intraday Technical Levels

Support      Resistance

1893            1913

1885            1923

1874            1932

Pivot Point: 1904

Gold (XAU/USD) – Technical Outlook

The price of gold experienced a temporary negative pressure, causing it to settle within the bullish pennant's pattern once again. However, new positive signals from the stochastic indicator are expected to motivate the price to continue its bullish trend for the day, with the next target located at $1,928.60.

As such, we maintain a bullish outlook, provided that the price remains stable above $1,878.80. Any continued decline and a breach of this level may lead to further losses, potentially reaching the $1,828.70 areas.

For today's trading, we anticipate a trading range between support at $1,890.00 and resistance at $1,928.00.

Daily Price Outlook

The S&P500 has risen 1.65% on the last day to trade at 3,919.29. US stocks recovered as anticipation of the extent of the rate rise at the Federal Reserve's policy meeting next week was muted by inflation data that was mostly on target and easing concerns about the spread in the banking sector.

US CPI Eases

On Tuesday, investors appeared to take hope in the fact that the risk of market spread from the Silicon Valley Bank crisis was reducing. However, the stability of the global banking industry under rising interest rates remained a focus.

Meanwhile, the CPI data from the US Labor Department revealed that consumer prices decreased in February, roughly in line with market forecasts, with both headline and core measures recording significant annual decreases.

The Consumer Price Index (CPI), which measures inflation in the US, decreased from 6.4% in January to 6% in February. The reading matched the expectations set by the market.

There is still a long way until inflation reaches the central bank's 2% target on an annual average. However, the chances that the Federal Reserve would adopt a 25 basis-point boost to its benchmark interest rate at the end of its two-day policy meeting on March 22 has grown in response to indications of economic softening and the regional banking crisis.

The US dollar fell as traders doubted the possibility of another rate increase by the Fed later this month in light of the US financial crisis and easing inflation. DXY is now trading down at 103.54. Moreover, the US 10-Year Treasury yield increased to trade at 3.666%.

After several days of risk-off instability, the S&P 500 finished significantly higher as bank fears decreased and inflation cooled.

Insulet was selected to take SVB's spot on the S&P 500 index.

The parent firm, SVB Financial Group, is no longer eligible for listing on the S&P 500 after authorities interfered and shut down Silicon Valley Bank. As a result, the bank dropped from the index before the markets opened on Wednesday, and Insulet took its place.

Insulet's inclusion in the S&P 500 comes just a few weeks after the company announced its highest-ever annual revenues, beating last year's record. The manufacturer of diabetes technology made $1.3 billion overall in 2022, an increase of more than 18% from the previous year.

The stock price rose sharply after news that Insulet would replace SVB on the S&P 500. Moreover, the S&P 500 performed better than anticipated.

S&P500 Intraday Technical Levels

Support      Resistance

3808.07       3904.26

3760.37       3952.75

3711.88       4000.45

Pivot Point: 3856.56

S&P500 – Technical Outlook

The S&P 500 (SPX) has encountered a hurdle near the $4,060 level, which is reinforced by a 50% Fibonacci retracement mark. As a result, the index has fallen once again from a technical standpoint. Closing candles below this level are indicating a sell zone for SPX, and the "three black crows" pattern in the 4-hour timeframe is contributing to the bearish sentiment among investors.

Currently, the SPX's immediate resistance level is at $4,095, which is supported by a 61.8% Fibonacci correction level on the upside. A bullish breakout above the $4,035 level could lead to further gains towards the $4,200 mark. However, if the support level at $3,930 is broken, the SPX may drop towards the next support level at $3,880.

Daily Price Outlook

On Tuesday, March 14th, BTC/USD opened at $24,187. It reached a high of $24,356 and a low of $24,074 before trading at $24,338. BTC/USD has gained over 20% in the past few days.

Market Hopeful for Dovish Stance from Fed

Recently, concerns about the financial stability of Silicon Valley Bank led to withdrawal and transfer limitations for its account holders, including several crypto firms. However, on Monday, the bank's account holders were granted full access to their funds following the government's assurance of protecting all depositors.

In addition, the failure of Signature Bank, the primary banking partner of Circle, a peer-to-peer payments tech firm, has exposed the stablecoin ecosystem's dependence on certain centralized entities.

After regulators intervened to support deposits at Silicon Valley Bank (SVB) and Signature Bank (SBNY), investors felt relieved and grew optimistic that the banking sector's meltdown would lead the Federal Reserve to scale back its hawkish monetary policy.

This led to a fall in the US dollar as traders questioned whether the Fed would raise rates again later this month, given the ongoing US banking crisis.

As a result, the DXY is now trading down at 103.63. The risk sentiment of BTC traders returned, causing BTC/USD to soar above $24,000 for the first time in more than two weeks.

Binance Converts Cash Reserves into Cryptocurrencies to Boost Bitcoin, Ether, and Binance Coin Tokens

The world's largest cryptocurrency exchange, Binance, recently announced its plan to convert a $1 billion industry fund into Bitcoin, Ether, and Binance Coin tokens. This move helped boost the value of these cryptocurrencies.

According to Binance's founder and CEO, Changpeng Zhao, the conversion from the industry fund to BUSD took only five seconds and cost $1.29. This announcement followed the US government's commitment to protecting depositors of two struggling regional banks, Silvergate, and Silicon Valley Bank.

Overall, Binance's decision to convert its fund into cryptocurrencies demonstrates growing confidence in the crypto market and highlights the potential for digital assets to become more mainstream.

The failure of Silvergate and Silicon Valley banks has caused significant concerns in the crypto market, limiting their ability to trade freely and causing panicked token sales. However, the fear eased after the Federal Reserve announced on Sunday that it would guarantee all deposits, not just those federally insured.

Furthermore, Binance's move to convert a $1 billion fund into Bitcoin, Ether, and Binance Coin tokens created a significant boost in buying pressure, leading to an increase in BTC/USD. The news that Bitcoin rose due to Binance's announcement and a sense of relief in avoiding another crypto disaster contributed to the rise.

BTC/USD Intraday Technical Levels

Support     Resistance

22532         25201

20877         26215

19863         27870

Pivot Point:23546

BTC/USD – Technical Outlook

Bitcoin's value has rocketed since last Friday, with the largest cryptocurrency by market size recovering by about 30% from its lows on Friday. As a result of the upswing, the price has broken the 2023 record by going above $26,000.

During a crisis in the financial industry and massive bank runs, Bitcoin's value increased. BTCUSD jumped past $25,000 and then passed the $26,000 level after today's CPI data was released, which came in at 6%. From Bitcoin's initial fall below $26,000 in June 2022, the cryptocurrency has struggled to rise above that mark.

Following a potentially different reaction at a retest of the downtrend resistance line, things may be different this time around. After retesting $20,000 late last week, BTCUSD had a tremendous increase, with the price per coin climbing by more than 25%.

Daily Price Outlook

The GBP/USD is currently trading at 1.2151, which reflects a decrease of 0.25% in the last 24 hours. As traders anticipate significant economic data releases from the US and the UK, the pair is restricted to its recent trading highs.

Upcoming UK Macroeconomic Data

The upcoming UK employment statistics release is expected to have a significant impact on the British Pound in the days ahead. According to experts, the Claimant Count Change (Feb) is predicted to decrease by 12.4K, which is slightly less than the previous announcement of 12.9K. However, the three-month unemployment rate may rise to 3.8% from the previous release of 3.7%.

The Average Earnings data is expected to be the primary driver, with a predicted decrease to 5.7% from the previous release of 5.9%.

Investors must exercise caution as the UK economy faces inflationary pressures from rising labor costs and persistent increases in food prices. A decrease in UK employment costs and an increase in the unemployment rate could potentially reduce inflation expectations.

Despite this, the Pound is struggling to gain momentum due to investor concerns about risks to the UK financial system, leading to lower risk sentiment. However, if the Average Earnings Index and Claimant Count Change exceed expectations, it could potentially benefit the GBP/USD pair.

US Upcoming CPI

Following the fallout of SVB US on Friday, the US markets saw a significant decline. Despite emergency measures implemented by US authorities over the weekend to mitigate risk and restore confidence in the US banking system, investors remain uneasy today.

Although the risk-off sentiment initially supported the USD, markets have reduced their expectations for the Federal Reserve to raise interest rates. The US banking industry is displaying signs of instability due to high-interest rates, which could make Fed officials hesitant to implement further tightening measures.

Traders are currently anticipating Tuesday's US CPI release. According to market forecasts, the US CPI is expected to fall 6.0% YoY from 6.4%, while the CPI ex-Food & Energy might decline to 5.5% YoY from 5.6%.

As investors await the US CPI data, the dollar has risen again, with DXY up 0.25% on the day and trading at 103.86. The 10-Year US Treasury Rate in the bond markets was at 3.569%. Furthermore, if the US CPI comes in below expectations, it could strengthen the GBP/USD pair.

GBP/USD Intraday Technical Levels

Support      Resistance

1.2081         1.2242

1.1980         1.2302

1.1919         1.2404

Pivot Point: 1.2141

GBP/USD – Technical Outlook

The GBPUSD pair has remained relatively unchanged since this morning and is hovering around the 1.2150 level. The expected bullish trend scenario for today remains unchanged, targeting the 1.2260 and 1.2440 levels as the next main stations. However, a positive motive is needed to push the price towards the suggested targets.

It is important to note that the continuation of the bullish wave depends on the price staying stable above 1.2070. The expected trading range for today is between 1.2070 support and 1.2250 resistance.

Daily Price Outlook

The AUD/USD pair is currently trading at 0.6637, down by 0.41% within the last 24 hours. The pair has trended lower due to the USD's increased value in anticipation of the US CPI.

Westpac Consumer Sentiment

A private survey released on Tuesday revealed that consumer confidence in Australia remained unchanged from the previous month in early March. Despite this, confidence levels continued to hover around COVID-era lows due to the country's struggle with high inflation and increasing interest rates.

The Westpac-Melbourne Institute Consumer Sentiment index remained constant at 78.5 in March, as per a report from Westpac. While this level was still near its lowest point since March 2020, the bank noted that it was uncommon to have two consecutive months of low consumer confidence, indicating rising concerns about inflation among the general public.

In addition, consumers in Australia are expecting further interest rate hikes by the Reserve Bank of Australia (RBA), which has already had a negative impact on the country's economy. RBA Governor Philip Lowe has indicated that the bank may pause its rate hikes as early as April if inflationary pressures ease, but some experts predict that the bank will continue to raise rates until May.

The Australian dollar initially declined as investors anticipated a slowdown in the pace of future rate hikes, but if the RBA follows through with raising rates until May, it could ultimately benefit the AUD/USD pair.

US Dollar Rebounded Ahead of US CPI

On Sunday, the Federal Reserve developed a contingency plan to mitigate the damage to the US banking system caused by Silicon Valley Bank's (SVB) collapse, reducing market risk.

Traders are eagerly anticipating the US Consumer Price Index (CPI) report on Tuesday, with some market experts revising their expectations for a 50 basis point (bps) rate hike by the Fed on March 22.

As a result, the dollar is strengthening, with the US Dollar Index (DXY) trading at 103.89, a 0.28% increase in the last 24 hours. The yield on US 10-Year Bonds has also risen to 3.564%.

A continuously rising interest rate may weaken the banking system, and high inflation rates pose a double challenge for central banks. As a result, the upcoming US Consumer Price Index (CPI) will be crucial to observe since it will further complicate the Federal Reserve's position.

Traders expect a decrease in the US CPI, which could lead to a reversal of the Fed's aggressive stance and a potential increase in the AUD/USD price.

AUD/USD Intraday Technical Levels

Support      Resistance

0.6590         0.6727

0.6517         0.6791

0.6453         0.6864

Pivot Points:0.6654

AUD/USD – Technical Outlook

The AUD/USD pair has fallen below the 0.6665 level and is currently bearish, heading towards the second target of 0.6550. It is currently trading within a bearish channel, increasing the likelihood of further bearish corrections, and a potential decline towards 0.6400.

The bearish wave continues to be supported by the EMA50, and a negative momentum may be necessary to break through and reach the expected target.

However, if the pair manages to surpass the 0.6665 level, it could prevent the anticipated decline and initiate recovery attempts, with an initial target of 0.6780. The expected trading range for the day is between the support level of 0.6500 and the resistance level of 0.6620.