Today’s report: Investors looking for a better week
We’ve seen an extension of US Dollar weakness in recent sessions, partially on the back of deteriorating consumer sentiment in the US and perhaps partially because of the risk on reaction to the US avoiding a government shutdown.
Wake-up call
- expansion plans
- contraction territory
- pay gain
- China news
- Mark Carney
- global sentiment
- Trump policies
- Macro themes
Peformance chart: 30-Day Performance vs. US dollar (%)
Suggested reading
- Why The Worst Of The Correction May Be Over, M. Hulbert, Marketwatch (March 13, 2025)
- A New Economic Power Is Rising In Europe, J. Lukawska, Business Insider (March 14, 2025)
Chart talk: Technical & fundamental highlights
Choose pair:
EURUSD – technical overview
The Euro has been in a multi-month consolidation since bottoming out in 2022. Setbacks have since been exceptionally well supported on dips towards parity, with a higher platform sought out ahead of the next major upside extension. Look for a push back towards the 2023 high at 1.1276 in the days ahead. Only a monthly close below 1.0000 negates.EURUSD – fundamental overview
The Euro has regained support after incoming Chancellor Merz seemingly confirmed the Green Party was set to back his fiscal expansion plans. The special fund for infrastructure will total around 500 billion Euro. There will also be an exemption from the debt break for defense spending above 1%. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.EURUSD - Technical charts in detail
GBPUSD – technical overview
Signs have emerged of the market wanting to put in a longer-term base after collapsing to a record low in September 2022. The door is now open for the next major upside extension towards the 2018 high at 1.4377. Setbacks should be well supported above 1.2000 on a monthly close basis.GBPUSD – fundamental overview
The Pound took a dip after UK economic growth dipped into contraction territory. Meanwhile, both industrial production and manufacturing production numbers were softer. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.USDJPY – technical overview
There are signs of a meaningful top in place after the market put in a multi-year high in 2024. At this point, the door is now open for a deeper setback towards the 140 area.USDJPY – fundamental overview
The Yen has come under added pressure after the results of the Rengo pay tally showed an average wage increase of 5.46% after originally demanding 6.09%. The reaction could be a selling of the fact, as all of this data continues to point to renewed Yen demand on dips as the BOJ continues to move towards tighter monetary policy. Yen selling could also be coming from Trump comments that reciprocal tariffs on automotives will be implemented. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.AUDUSD – technical overview
There are signs of the potential formation of a longer-term base with the market trading down into a meaningful longer-term support zone. Only a monthly close below 0.6000 would give reason for rethink. A monthly close back above 0.7000 will take the big picture pressure off the downside and strengthen case for a bottom.AUDUSD – fundamental overview
Aussie is better bid in recent sessions on the back of news out of China that it will take steps to revive consumption by boosting the people's income. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.USDCAD – technical overview
A sustained hold above 1.3000 over the past several months signals an end to a period of longer-term bearish consolidation and suggests the market is in the process of carving out a more significant longer-term base. Next key resistance now comes in at the 1.5000 psychological barrier. Setbacks should be very well supported ahead of 1.4000.USDCAD – fundamental overview
Mark Carney has been sworn in as Canada's next Prime Minister and the Canadian Dollar has responded positively. We continue to see traders cutting back on short Canadian Dollar positions, though uncertainty around the trade outlook with the US remains high. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.NZDUSD – technical overview
Overall pressure remains on the downside with the market continuing to stall out on runs up into the 0.6500 area. At the same time, there are some signs of the market wanting to put in a longer-term base. Ultimately, a break back above 0.6500 would be required to take the medium-term pressure off the downside and encourage this prospect. A monthly close below 0.5469 will intensify bearish price action.NZDUSD – fundamental overview
Kiwi is better bid in recent sessions on the back of a recovery in US equities and news out of China that it will take steps to revive consumption by boosting the people's income. Looking ahead, we get Canada housing starts and foreign securities purchases, US retail sales, NY empire manufacturing, and ECB Lagarde speech, and US business inventories.US SPX 500 – technical overview
The longer term uptrend remains intact and dips continue to be exceptionally well supported. Critical support comes in at 5386, with only a weekly close back below this level to compromise the structure. Until then, the focus remains on the formation of the next major higher low.US SPX 500 – fundamental overview
Going forward, it will be important to keep an eye on Trump trade policies, inflation, bigger picture economic data and the Fed policy outlook. Any of these variables are capable of easily ruffling some feathers and we've already seen a little of this as 2025 gets going.GOLD (SPOT) – technical overview
The 2019 breakout above the 2016 high at 1375 was a significant development, opening the door for fresh record highs and this next major upside extension above 3000. Setbacks should now be well supported above 2500 on a monthly close basis.GOLD (SPOT) – fundamental overview
The yellow metal has pushed record highs in recent months with solid demand from medium and longer-term accounts. These players are more concerned about inflation, geopolitical risk and a less upbeat global growth outlook. All of this should keep the commodity well supported over the coming months.