US Dollar extends decline

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.

• R2 1.3048 – 6 November high – Strong
• R1 1.2909 – 6 March/2025 high – Medium
• S1 1.2800 –  Figure – Medium
• S2 1.2768 – 5 March low – Strong

GBPUSD – fundamental overview

The Pound got a nice boost from BOE Greene who indicated the central bank's policy remains restrictive. Key standouts on Thursday’s calendar come from German, Eurozone, and UK construction PMIs, Eurozone retail sales, the ECB policy decision, Canada trade, US trade, initial jobless claims, Canada Ivey PMIs, BOE speak, and Fed speak.

USDJPY – technical overview

The market is looking to resume the longer-term uptrend after an intense correction in 2024. A higher low is ideally sought out above 140.00 in favor of a bullish continuation. The October monthly close back above 150.00 strengthens the case for longer-term uptrend resumption.

• R2 152.00 – Figure – Medium
• R1 151.31 – 3 March high – Medium
• S1 148.56 – 25 February low – Medium
• S2 148.09 – 4 March/2025 low – Strong

USDJPY – fundamental overview

The Yen continues to benefit from hawkish BOJ rhetoric, shifting Fed expectations and broad based US Dollar selling. A call from BNP Paribas Asset Management of 130.00 USDJPY is also having an impact. Key standouts on Thursday’s calendar come from German, Eurozone, and UK construction PMIs, Eurozone retail sales, the ECB policy decision, Canada trade, US trade, initial jobless claims, Canada Ivey PMIs, BOE speak, and Fed speak.

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.

• R1 0.6409 – 21 February/2025 high – Strong
• R2 0.6357 – 6 March high – Medium
• S1 0.6187 – 4 March low – Medium
• S2 0.6164 – 17 January low – Medium

AUDUSD – fundamental overview

A run of broad based US Dollar outflows has been accompanied by a round of better than expected Aussie data in the form of trade and building permits. This has added to Aussie demand after the currency was also already getting support from yesterday's solid GDP print. Key standouts on Thursday’s calendar come from German, Eurozone, and UK construction PMIs, Eurozone retail sales, the ECB policy decision, Canada trade, US trade, initial jobless claims, Canada Ivey PMIs, BOE speak, and Fed speak.

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.

• R2 1.4595 – 30 January high – Strong
• R1 1.4544 – 4 March high – Medium
• S1 1.4270 – 5 February low – Medium
• S2 1.4151 – 14 February/2025 low – Strong

USDCAD – fundamental overview

The Canadian Dollar is feeling better about the trade outlook after the US commerce secretary offered up some words of reassurance about the prospect for a deal. Key standouts on Thursday’s calendar come from German, Eurozone, and UK construction PMIs, Eurozone retail sales, the ECB policy decision, Canada trade, US trade, initial jobless claims, Canada Ivey PMIs, BOE speak, and Fed speak.

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.

• R2 0.5818 – 12 December high – Medium
• R1 0.5773 – 21 February/2025 high – Medium
• S1 0.5585 – 28 February low – Medium
• S2 0.5541 – 13 January low – Medium

NZDUSD – fundamental overview

The New Zealand Dollar has been better bid on the back of broad based US Dollar outflows and an uptick in global risk sentiment. Key standouts on Thursday’s calendar come from German, Eurozone, and UK construction PMIs, Eurozone retail sales, the ECB policy decision, Canada trade, US trade, initial jobless claims, Canada Ivey PMIs, BOE speak, and Fed speak.

US SPX 500 – technical overview

The longer term uptrend remains intact and dips continue to be exceptionally well supported. Critical support comes in at 5770, with only a break back below this level to compromise the structure and open the door for a more significant corrective decline. Until then, the focus remains on a continued push to fresh record highs.

• R2 6152 – 19 February/Record high – Strong
• R1 6014 – 26 February high – Medium
• S1 5740 – 4 March/2025 low – Medium
• S2 5697 – 4 November low – Strong

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 into the 3000 area. Setbacks should now be well supported above 2500 on a monthly close basis.

• R2 3000 – Psychological – Strong
• R1 2957 – 24 February/Record high – Medium
• S1 2833 – 28 February low – Medium
• S2 2730 – 27 January low – Strong

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.