Daily Market Analysis from ForexMart

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Currency
Rates
EUR / USD
1.1134
USD / JPY
107.715
GBP / USD
1.24072
USD / CHF
0.96054
USD / CAD
1.37210
EUR / JPY
119.930
AUD / USD
0.67211

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KostiaForexMart

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EUR/USD. March 2, 2020 – Euro reaches 1.11

Investors' appetite for risky assets on global markets is moderately recovering after the world's leading central banks announced their readiness to maintain economic activity in the face of the risks associated with the spread of coronavirus.

On Friday, the US Federal Reserve announced that the regulator intends to use monetary policy instruments to maintain the country's economy. Market participants expect that the key rate in the US will be reduced immediately by 50 bp. already at the March meeting. The readiness to take large-scale measures on the eve was also expressed by the Central Bank of Japan.

Thus, the EUR/USD pair continues to grow, almost closely approaching the level of 1.1100. However, the European currency is still under pressure from the further spread of the coronavirus throughout Europe. Therefore, the pair may show a slight decrease from level 67,00.
 
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EUR/USD. March 03, 2020 – Euro firmly fixed above 1.11

The euro did not manage to overcome the level of 1.1185 and it again started to decline to the area of 1.11. At global sites, the appetite for risky assets is recovering after the ECB, the US Federal Reserve and other world Central Banks announced their readiness for additional monetary stimulation of the economy to mitigate the detrimental effects of coronavirus. Moreover, today representatives of G7 countries will discuss a package of measures aimed at minimizing the consequences of the epidemic.

Today is not rich in significant macro statistics, and the dynamics of trading will be determined mainly by the news background on the topic of coronavirus. However, you should pay attention to inflation data in the eurozone. Consumer price growth slowed from 1.4% in January to 1.2% in February.

The euro continues to strengthen from the level of 1.11. During the day, «eurobulls» will rise to the level of 1.1150.
 

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EUR/USD. March 04, 2020 – Dollar weakens after unplanned US Fed rate cut

The US dollar came under pressure after an unexpected decision by the US Federal Reserve to lower the interest rate by 50 bp, without waiting for the meeting scheduled for March 18. The last time a rate cut outside a scheduled regulator meeting in the US occurred during the 2008 crisis.

Such actions by the authorities may signal that the risks of a recession in the US economy are still great. Moreover, today in the markets there is a restoration of appetite for risky assets. As a result, the pair EUR/USD rose to the level of 1.1215.

Today, you should pay attention to the US labor market data from ADP, as well as the publication of the ISM index in the non-manufacturing sector of the economy. In the case of weak data, the risk appetite in the evening hours may worsen, which will allow the dollar to somewhat regain its position in pair with the euro. The current quotation of the pair is 1.1150.
 
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EUR/USD. March 05, 2020 – The euro slowed down its growth at the level of 1.12

The level of 1.1200 restrains further growth of the European currency, the current quotation of the EUR/USD pair is 1.1170. The day before the US dollar was under pressure after an unexpected Fed rate cut by 50 bp at once. However, yesterday evening this pressure slightly decreased amid the publication of strong labor market data from ADP and the ISM index in the service sector, which in February rose from 55.5 to 57.3.

Today it became known that the California authorities in the United States announced an emergency mode because of the risks of the coronavirus spread, and Italy decided to close schools until March 15 in the fight against the epidemic. The news signals that the risks of a recession in many economies are still extremely high.

Today you should pay attention to the weekly statistics on initial applications for unemployment benefits in the United States. Experts predict a decrease in the number of calls from 219 thousand to 215 thousand.
 
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EUR/USD. March 06, 2020 – Euro approaches 1.13 high

The euro continues to increase the pace of strengthening, approaching the level of 1.1300. Pressure on the dollar was exerted by an unplanned reduction in the interest rate of the US Federal Reserve, reflecting the fears of the authorities about the presence of significant risks in the country's economic system.

Moreover, the Fed rate can be cut by another 25 basis points (from the current target range of 1.00-1.25% per annum) at the meeting on March 18-19. This could trigger a wave of sales of the American currency and send the pair to the 1.1400 area.

The spread of coronavirus in Europe remains high, which puts pressure on risky assets. Today's statistics on the US labor market may have an additional negative impact on risk and dollar if the current data are below forecast. In case of further deterioration in risk appetite, the euro will continue to receive support in the Forex market.
 

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EUR/USD. March 10, 2020 – Euro fell from highs to 1.1325

The growth of the European currency was stopped by the level of 1.15 – EUR/USD quotes fell on Tuesday to around 1.1325. Yesterday, a drop in the oil market to $32 per barrel triggered a collapse of major indices around the world. In addition, the continued spread of coronavirus outside of China also continues to put pressure on world markets.

It became known that Italy introduced a regime of emergency measures to combat the virus throughout the country, and the head of WHO said that the outbreak of the virus is already very close to becoming a pandemic. The presence and further spread of coronavirus in Europe puts pressure on the euro.

The US dollar, in turn, is under the negative impact of rising yields on 10-year US Treasury bonds and expectations of a Fed rate cut immediately by 70 bp. on the meeting of the American regulator on March 18.
During the day, the EUR/USD pair will continue to grow from the level of 1.1325.
 

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EUR/USD. March 11, 2020 – The pair near 1.13 in anticipation of US inflation data

The US stock market is gradually recovering after the collapse on Monday, and investor sentiment on global markets remains relatively optimistic. The current quotation of the EUR/USD pair is 1.1300. The dollar received some support after U.S. President Donald Trump discussed payroll tax cuts with Republican officials as part of tax breaks.

However, the further spread of coronavirus outside of China still retains the risks of further sales in the financial markets. The number of cases worldwide continues to increase. In the USA, in particular, the number of cases has already exceeded 1000 people.

Today, attention should be paid to inflation data in the United States, which may reflect its deceleration from 2.5% to 2.2%. Amid the expectation of another Fed rate cut at the March meeting, this slowdown could trigger a wave of sales of the US dollar.
 

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EUR/USD. March 12, 2020 – Euro weakens awaiting ECB meeting

Negative sentiment caused by a statement by the World Health Organization (WHO) has returned to global markets. Yesterday, WHO officially assigned pandemic status to the spread of the virus Covid-19, which put strong pressure on the entire block of risky assets. Additional pressure on the markets had a 30-day US ban on entry to the country for all travelers from Europe.

The pair EUR/USD is trading at 1.1250. The euro is moderately declining, under pressure from the words of the ECB head K. Lagarde. The politician said that in the absence of coordinated actions by the authorities, the situation in the EU economy could develop according to the 2008 crisis scenario.

Today, attention should be paid to the ECB meeting. Market participants expect the regulator to introduce a range of monetary incentives, and the scale of measures taken is of particular interest.

At the same time, the US dollar received support after the release of inflation data in the country. Annual inflation in February slowed to 2.3%, better than forecasted.
 

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Fundamental Brent analysis for March 13, 202

Yesterday, Brent quotes fell again to the level of $32.50 per barrel amid panic sales in global markets. However, today prices are already showing a recovery to $35.40 per barrel.

Support for Brent and other risky assets was provided by the US Federal Reserve reports on a massive infusion of dollar liquidity into the system in the near future.

However, one should not expect a significant strengthening of «black gold», since the situation with the spread of coronavirus in the world remains very dangerous, and OPEC oil-producing countries continue the price war in attempts to increase their market share.
 

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EUR/USD. March 16, 2020 – Dollar weakens after Fed’s decision to cut rate again

The US dollar came under strong pressure after an emergency cut in the US Fed rate on Sunday. The regulator reduced the rate immediately by 100 bp. to 0-0.25% for the first time since 1982, and also announced the launch of a large-scale program for the purchase of financial assets with a total volume of $700 billion. As a result, the EUR/USD pair rose to the level of 1.1230.

The situation with the further development of the coronavirus pandemic puts pressure on all global markets. More and more countries restrict the movement of people, close their borders and introduce other quarantine measures. In the United States, a state of emergency was declared on Friday.

The set of preventive measures of the US government signals the increased risks of a recession in the US economy, which forms a negative background for all risky assets. During the day, the pair will fluctuate near the level of 1.12.
 
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