FxWirePro: Forex Daily Update

FxWirePro: Forex Daily Update 

The US dollar index traded highly volatile after Fed monetary policy. The central bank kept its rates unchanged at 5.25%-5.50% for the fourth consecutive day. They stated that  "recent indicators suggest that economic activity has been expanding at a solid pace. Job gains have moderated since early last year but remain strong."minor pullback ahead of US Fed monetary policy.  The committee said it would go for a rate cut only if inflation is moving sustainably at 2 percent". 

   According to the CME Fed watch tool, the probability of a no-rate cut in  Mar at 65% from 58.80% a week ago.

 The US 10-year yield declined sharply despite hawkish US Fed policy. The US 10 and 2-year spread narrowed to -31.5% from -53%.

Major resistance- 103.75/105

Major support- 102.70/101.60.

EURUSD-
 
EURUSD trades weak after hawkish US Fed policy.   US ADP private employment grew at 107k in Jan, below expectations of 141000. German CPI came at a 2.9% YoY vs. an Estimate of 3.2%.

Eurozone Core CPI flash estimate (10:00 am GMT)

Major resistance-1.08850,1.1000

Major support- 1.0800,1.07200

Yen- 

The yen traded higher as demand for safe-haven increased due to the escalation of geopolitical tension in the Middle East. Any close below 146.50 confirms further bearishness.

Major Resistance- 148.80,150

Major support- 146.50,145

Canadian Dollar 
    
The Canadian dollar pared some of its gains despite upbeat Canada GDP data. the Canadian economy grew at 0.20% m/m in Nov, compared to a forecast of 0.10%.  

Resistance- 1.3450,1.3500

Major support- 1.3400,1.3300

Feb 1st, 2024, BOE monetary policy  (noon GMT)

                       US ISM manufacturing PMI     (3 pm GMT)