Solid ECN | Professional Market Analysis | *Video*

[SOLIDECN]

Market update by Solid ECN​

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EURUSD holds at record lows
The pressure on the position of the trading instrument is still exerted by the growing geopolitical tension in Eastern Europe Negotiations aimed at an immediate ceasefire, which the parties tried to hold at the end of February, did not lead to any results, and Russian troops continue to conduct a special military operation on the territory of Ukraine. In the meantime, the Russian economy is facing unprecedented pressure from sanctions, which has some counter-effect.

Macroeconomic statistics from Europe published yesterday turned out to be mixed.
The statistics on business activity showed a slight decline, but the February data does not yet include such a sharp deterioration in the situation in Eastern Europe. Anyway, the Markit Manufacturing PMI in the euro area in February fell, while analysts did not expect any changes at all. But statistics on inflation in Germany supported the position of the euro. The Harmonized Price Index increased by 5.5%, beating forecasts of a 5.4% increase.

Support and resistance
Bollinger Bands in D1 chart demonstrate active decrease. The price range is expanding, but at the moment it is not keeping up with the surge of "bearish" sentiment. MACD is going down preserving a stable sell signal. Stochastic is showing similar dynamics; however, the indicator is rapidly approaching its lows, indicating the risks of oversold EUR in the ultra-short term.

Resistance levels: 1.115, 1.1185, 1.1220, 1.1255.
Support levels: 1.11, 1.1054, 1.1, 1.0952.​

 

[SOLIDECN]

Market Update by Solid ECN​

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GBPUSD
The pound is consolidating near 1.34

The macroeconomic background from the UK remained rather restrained, as well as the general sentiment on the market against the backdrop of escalating tensions in Eastern Europe. Anyway, yesterday's data showed the BRC Retail Price Index rising 1.8% in January after rising 1.5% in December. The Nationwide House Price Index (not seasonally adjusted) accelerated from 11.2% to 12.6% in February, well ahead of forecasts of a slowdown to 10.7%.

Meanwhile, the EU countries, as well as the UK, continue to exert significant sanctions pressure on Russia. The day before, the British Ministry of Finance banned the largest financial institution in Russia, Sberbank PJSC, from conducting clearing operations in pounds. In addition, a complete freeze on the assets of three Russian banks was introduced, and all Russian companies were denied access to the capital market of the United Kingdom. Sanctions also harm the European economy, but the West's position in this sense is clear and unambiguous.

Support and resistance
Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range expands from below, making way for new local lows for the "bears". MACD has reversed upwards preserving a sell signal. Stochastic demonstrates similar dynamics, gradually changing its direction. Current readings of the indicators signal in favor of a corrective growth in the ultra-short term.

Resistance levels: 1.3435, 1.346, 1.35, 1.355.
Support levels: 1.335, 1.33, 1.3250, 1.32.​

 

[SOLIDECN]

Market Update by Solid ECN​

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USDCHF
Growth ahead of the release of the report on the US labor market

Current trend
During the Asian session, the USDCHF pair is growing slightly, trying to consolidate above the psychological level of 0.92. The market's focus is the situation in the east of Europe, where, despite tough economic sanctions and the consolidated position of Western countries, Russia continues to conduct a special military operation. However, investors are also trying to assess how much the escalation of tensions will affect the global economy.

At the end of the week, the market will receive the February report on the US labor market, but for now, investors are reacting to the publication of the ADP report and the speech of the head of the US Federal Reserve, Jerome Powell. The statistics showed an increase of 475K in Nonfarm Payrolls after 509K last month. Market forecasts assumed growth of only 388K. Commenting on the published data, the department chairman confirmed the intention officials to raise the key interest rate at a meeting at the end of March. He also noted systemic improvements in the labor market and again pointed to rising inflation, well above the target threshold of 2% per annum.

Support and resistance
Bollinger bands are moderately declining on the daily chart: the price range is actively narrowing from above, indicating an ambiguous nature of trading in the short term. The MACD indicator reverses upwards, forming a new buy signal (the histogram is trying to consolidate above the signal line). Also, the indicator is preparing to test the zero line for a breakout. Stochastic, reversed from the level of "20" into an upward plane, signals in favor of developing "bullish" dynamics in the short and/or ultra-short term.

Resistance levels: 0.9220, 0.9250, 0.9276, 0.9300.
Support levels: 0.9200, 0.9175, 0.9148, 0.9100.​

 

[SOLIDECN]

Sliver price slightly adjusted
Silver prices have shown a slight decline during the Asian session, consolidating near 25.00. Pressure on the quotes of XAG/USD is exerted by technical factors of fixing long profits, as well as the growth of the US currency. However, the position of the asset remains strong against the backdrop of Western sanctions against Russia after the start of a special military operation in Ukraine, increasing the likelihood of supply disruptions.

Meanwhile, the US currency is supported by the optimistic macroeconomic background in the US. In addition, investors expect an increase in interest rates from the US Fed already during the March meeting of the regulator (in two weeks). At the same time, the Chair of the department, Jerome Powell, once again confirmed their intention to adjust the rate, noting the success of the American economy and growing inflationary pressure. In addition, the USD Index has approached its highest since May 2020, making silver more expensive for overseas buyers.

Today, investors will focus on a large block of US statistics, which may support the dollar "bulls". In particular, the data on Jobless Claims, on the dynamics of Factory Orders, as well as on the ISM services PMI will be released. In addition, the US Fed Chairman Jerome Powell is once again expected to address Congress during the day. Tomorrow the markets will be focused on the February report on the US labor market.

Support and resistance
Bollinger Bands on the daily chart show a steady increase. The price range is actively expanding; however, it fails to catch the recent development of "bullish" sentiments. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic is showing similar dynamics; however, the indicator line is already approaching its highs, indicating the risks of overbought instrument in the ultra-short term.

Resistance levels: 25.58, 26.00, 26.27, 26.57.
Support levels: 25.00, 24.67, 24.37, 24.00.

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[SOLIDECN]

USDCAD, wins back losses

During the Asian session, the USDCAD pair is growing uncertainly, developing the “bullish” momentum formed yesterday, when the instrument was trading near local lows since January 26.

Investors are in no hurry to open long positions on the US currency, preferring to wait for today's publication of the final report on the labor market for February, hoping to receive additional confirmation of the possibility of raising interest rates during the March meeting of the US Federal Reserve. Given the aggravation of the situation around Ukraine, it is likely that the regulator may change its original plans. Some concern is caused by the US statistics on business activity published in recent days, which reflects the rapid decline in sentiment, especially in the service sector.

The Canadian currency is supported by the actions of the Bank of Canada. On Wednesday, the regulator expectedly raised interest rates by 25 basis points to 0.5%. Yesterday, the head of department, Tiff Macklem, stressed that the Board of Governors of the bank expects further tightening of monetary policy as the national economy grows, while the previous target levels remain unchanged.

Support and resistance
On the daily chart, Bollinger bands reverse a horizontal plane: the price range slightly expands from below, trying to keep with the surge in trading activity in the middle of the week. MACD indicator tries to reverse upwards, keeping its previous sell signal (the histogram is below the signal line). Stochastic shows similar dynamics, retreating slightly from its lows, signaling that the US dollar is oversold in the ultra-short term.

Resistance levels: 1.2700, 1.2750, 1.2786, 1.2812.
Support levels: 1.2650, 1.2600, 1.2558, 1.2500.

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[SOLIDECN]

EUR USD Remains Under Pressure​

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[SOLIDECN]

Brent Crude Oil price hits $130 for the first time since 2012​

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Brent Crude Oil started the new week with active growth, trading close to 130 dollars per barrel. Peak prices reached 135 dollars, breaking the highs of 2012, but so far, the "bulls" cannot consolidate at such high levels.

Currently, there is increased investor activity, and volatility remains high, as traders are concerned about the prospects for Russian energy exports. Earlier in the media, there were reports that the United States and its closest allies are considering the possibility of a complete refusal of supplies from Russia.

Their import is difficult but not limited, which allows the US and Europe to make purchases. However, the prices of gasoline and natural gas in the EU countries are rising markedly, but this does not compare with the possibility of a complete embargo. Last week, as part of ministerial negotiations within the International Energy Agency (IEA), a decision was made to release 30M barrels of oil from the strategic reserve in connection with the situation around Ukraine. According to the head of the White House, Joe Biden, this will help reduce the likelihood of supply disruptions.

Iran may improve the situation. It continues negotiations around its "nuclear program." If successful, official Tehran will resume energy exports, partially compensating for the gaps in Russian exports, while OPEC+ may try to accelerate the process of restoring production volumes, given the further deterioration of the situation.

Resistance levels: 128.6, 131, 135.77, 138.
Support levels: 125.85, 122.6, 121, 118.32.​

 

[SOLIDECN]

USDJPY is consolidating around 115​

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The US dollar continues mixed trading against the Japanese yen, consolidating around 115.
USDJPY finished trading on Friday with a rather active growth, despite the fact that the published report on the US labor market showed a strong increase in Nonfarm Payrolls by 678K, while the average forecasts did not assume an increase of more than 400K. Demand for the dollar, as well as for the yen, remains quite high, as Russia continues to conduct a special military operation in Ukraine, despite the introduction of unprecedented sanctions against Russian business by Western countries.

Today traders expect the publication of Japanese statistics on Consumer Credit Change in February. During the day, Labor Cash Earnings and Trade Balance data for January will also be published.

Support and resistance
Resistance levels: 115, 115.28, 115.75, 116.
Support levels: 114.5, 114, 113.5, 113.​

 

[SOLIDECN]

USDCAD, the American currency continues to grow actively​

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The Canadian currency remains one of the few world currencies that successfully resists the actively growing US dollar. Currently, the USDCAD pair is showing local sideways dynamics, being at 1.271.

To stable economic indicators, the improvement of the epidemiological situation also contributes to the recovery of the Canadian economy. Yesterday, the chief medical officer of Ontario, where the highest number of infections with the Omicron strain of coronavirus was recorded, said that if the incidence continues to decrease, a complete lifting of restrictions and the permission not to wear masks in public places is possible. The country's authorities have already relaxed entry bans for fully vaccinated tourists, lifting the requirement to provide the results of a molecular coronavirus test.

As for the economic component, the index of business activity from the Institute of Statistics of Canada rose to 60.6 points from 50.7 points a month earlier, while labor productivity reduced the rate of decline to –0.5% from –1.8%.

USD Index continues to grow actively, reaching May 2020 highs near 98.900. The key driver of positive dynamics, also to expectations from the upcoming meeting of the US Federal Reserve, was macroeconomic statistics on the labor market. Nonfarm Payrolls increased by 678K jobs last week, significantly higher than 481K a week earlier. The result was much higher than analysts' expectations, which suggested a decline to 400K. Private Nonfarm Payrolls increased by 645K, up from 448K a week earlier.

Support and resistance
The price moves within a volatile sideways channel on the global chart, heading towards the upper border. Technical indicators are in the state of a poor buy signal. Indicator Alligator's EMA fluctuations range narrowed almost completely, and the histogram of the AO oscillator trades close to the transition level.

Resistance levels: 1.2775, 1.2938.
Support levels: 1.2660, 1.2494.

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[SOLIDECN]

GBPUSD, the pound is consolidating near 1.31​

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The British pound regains lost ground during the morning session on March 8, trying to retreat from record lows since November 2021, updated the day before. The downtrend in GBP/USD is due to the rapid strengthening of the US dollar quotes, as market participants are in a hurry to hedge risks against the backdrop of rising inflation and the continuation of a special military operation of Russian troops in Ukraine. On Monday, the trading instrument came close to strong support at 1.3100, below which the British currency was last traded in November 2020.

The pound, like many other high-yielding assets, is being sold amid escalating tensions in Eastern Europe and sanctions pressure exerted by Western countries on Russia, which intensified earlier in the week after the US authorities announced that they were considering a complete ban on energy imports from Russia. The position of European countries on this issue is not unanimous, as some of them, such as Germany, say that it is currently not possible to resolve the energy issue without Russian supplies. Against this backdrop, prices for gasoline, gas and electricity continue to rise in Europe.

The macroeconomic statistics from Great Britain, released at the beginning of the week, did not have a significant impact on the dynamics of the instrument. Halifax House Prices rose by 0.5% in February, which turned out to be noticeably worse than market forecasts at the level of 1.1%. BRC Like-For-Like Retail Sales in February slowed down sharply from 8.1% to 2.7%, while the market expected a strong growth of 15.2%.

Support and resistance
Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is expanding, but at the moment it is not keeping up with the surge of "bearish" sentiment. MACD is going down preserving a stable sell signal. Stochastic keeps a steady downward direction but is already approaching its lows, which indicates the risks of oversold pound in the ultra-short term.

Resistance levels: 1.315, 1.3200, 1.3250, 1.33.
Support levels: 1.31, 1.305, 1.3, 1.296.​

 

[SOLIDECN]

USDTRY, Turkish lira under pressure

During the Asian session, the USDTRY pair is growing slightly, developing the "bullish" momentum that formed in early March.

Annual inflation in Turkey shows record levels, reaching 54.4% in February. Given the further escalation of tensions around Ukraine, investors fear increased price pressure in the future. Consumer prices are rising at the fastest rate in forty years, up 7.22% in February and 105% YoY. The negative dynamics are developing against the backdrop of an increase in energy tariffs and a loose monetary policy of the Central Bank of the country: officials approve a national economic program aimed at attracting investment at a low interest rate.

On Thursday, American investors expect the publication of February statistics on consumer prices in the US. It is assumed that inflation will continue its growth and may reach 8.0%, which will significantly increase pressure on the position of the US Federal Reserve on the issue of tightening monetary policy. An increase in the rate is still expected at the end of March, but global regulators may reconsider their immediate plans due to the deterioration of the geopolitical situation in the world.

Support and resistance
On the daily chart, Bollinger bands grow moderately. The price range expands, letting the "bulls" renew local highs. The MACD indicator grows, keeping a relatively strong buy signal (the histogram is above the signal line). Stochastic shows similar dynamics but is close to its highs, indicating that USD may become overbought in the ultra-short term.

Resistance levels: 14.4, 14.5, 14.6.
Support levels: 14.3, 14.1, 13.9, 13.8.

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[SOLIDECN]

Crude Oil, the price set a new 4-year high​

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Yesterday, WTI Crude Oil quotes set a new 4-year high at 130 after statements by US Congress committees on the approval of a bill to ban Russian energy supplies.

The American authorities are preparing to block oil imports unilaterally, without the participation of Europe. In turn, eurozone officials also announced their readiness to reduce dependence on Russian gas by almost 80% this year. The plan, which will be unveiled today, will include new supply chains and energy efficiency steps and aim to achieve independence from the region's largest fossil fuel supplier well before 2030, much sooner than previously thought. The European Commission believes that the EU already has enough gas reserves to survive the rest of this winter, even in the event of a sharp cut in supplies from Russia.

Against this background, investors began to actively make deals on the purchase of "black gold", which pushed WTI Crude Oil quotes to the level of 130. Now the asset is winning back the growth and is trading slightly above 120. All this is happening without the final adoption of the bills described above. If the decision on the embargo on Russian energy is still approved, then one can expect an increase in the "bullish" momentum and price movement in the area of 145 - 150 dollars per barrel. Otherwise, oil may correct up to 105 - 100 dollars per barrel.

Support and resistance
The long-term trend has a pronounced upward direction. A breakout of 130 will allow the "bulls" to strengthen to the level of 145. The key trend support is shifting to the area of 85. Traders should pay attention to the readings of the RSI indicator, which indicates that the market is overbought, which may signal a possible correction in the near future.

The mid-term trend remains upward. Yesterday, the market participants tested the key trend support at 120.51 – 119.46. As long as it is held by buyers, there will be a possibility of price growth and a breakdown of the target zone 11 (127.76 – 127.18), which will allow the instrument to grow into the area of the target zone 12 (133.61–133.03).​

 

[SOLIDECN]

EURUSD, the euro develops technical correction​

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The European currency shows weak growth against the US dollar during the Asian session, developing a corrective momentum and testing 1.09 for a breakout; however, further development of the "bullish" dynamics for the instrument is limited by negative market sentiment regarding the growth prospects of the eurozone economy.

Analysts pay attention to the sharp increase in quotations on commodity markets after Russian President Vladimir Putin initiated a special military operation in Ukraine. Subsequently, the authorities of the Western countries imposed unprecedented sanctions on the Russian economy, and many global companies decided to refuse cooperation with business partners from Russia. In addition, the United States announced the day before that the country was completely refusing to import Russian oil, gas and other energy carriers, which is likely to further aggravate the situation on the commodity markets. Europe, in turn, will not yet be able to completely ban Russian imports, since it is much more dependent on them. However, further restrictions are possible, and, for example, the UK said earlier in the week that it intends to cut off Russian energy supplies by the end of 2022. In addition, sanctions could backfire, causing the euro system to fall, as a freeze on Russian assets could negatively impact European banks.

This week, investors will focus on the decision of the European Central Bank (ECB) on interest rates. The meeting will take place on Thursday, March 10, and current market forecasts suggest that the regulator will not change the parameters of monetary policy. Moreover, it is quite possible that the ECB will not raise rates at all this year, given the possible slowdown in economic growth in the region.

Support and resistance
Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is changing slightly, but remains rather spacious for the current level of activity in the market. MACD is trying to reverse upwards keeping a previous sell signal (located below the signal line). Stochastic is showing similar dynamics, retreating from its lows, indicating strongly oversold EUR in the ultra-short term.

Resistance levels: 1.095, 1.1, 1.1054, 1.11.
Support levels: 1.09, 1.086, 1.08, 1.075.​

 

[SOLIDECN]

Gold, the price of gold exceeded 2K dollars per ounce​

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Gold prices continue to develop "bullish" dynamics, trading above the psychological level of $2000 and renewing the highs since August 2020 against the backdrop of a massive withdrawal of investors from risks due to aggravated geopolitical tensions.

The key moment at the present time remains the export of energy carriers by the Russian Federation, including oil and gas. The US announced the day before that the country was refusing Russian imports, but does not expect that its European partners will be able to take similar measures in the near future. However, the EU is also concerned about the issue of energy security, and the UK, for example, announced its intention to stop importing Russian energy carriers before the end of the year.

Meanwhile, oil and gas prices continue to break records in the market, threatening Western economies with a sharp increase in inflationary pressures. In addition, a group of US Congressional senators prepared a draft banning Russia from selling gold in order to counter severe restrictions against the backdrop of blocking the international reserves of the Central Bank of the Russian Federation. Secondary sanctions are expected to apply to any US companies that transact or sell the precious metal physically or electronically in Russia.

Support and resistance
Bollinger Bands on the daily chart show a steady increase. The price range is actively expanding, but it fails to catch the surge of "bullish" sentiment at the moment. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic, having reached its highs, reverses into the descending plane, indicating risks of overbought gold in the ultra-short term.

Resistance levels: 2070, 2085, 2100.
Support levels: 2050, 2030, 2015, 2000

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[SOLIDECN]

USDJPY, Japanese economy continues to slow down​

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The USDJPY pair is growing against the backdrop of a depreciation of the Japanese currency, trading around 115.77.

The yen is rapidly losing value, and it is obvious that without decisive steps from the Bank of Japan, further devaluation cannot be avoided. This morning, another disappointing report was published, which reflected the high rate of a slowdown in the national economy:

Q4 GDP increased by 1.1%, which is lower than the preliminary estimates of experts at 1.4%. The negative dynamics led to a drop in the annual rate to 4.6%, while analysts had expected values around 5.6%. Although it increased by 2.4%, the level of consumer spending also fell short of the forecasted 2.7%.

USD Index is at the highs of the year, having stopped its growth around 98.900 points after the announcement of the US government about the complete rejection of imports of Russian oil products and fuel. Despite the insignificant share in the procurement chains from the American side, the consequences will be negative for the country. Today, investors are waiting for the January data from JOLTS to assess the state of the labor market. Analysts assume that the number of open vacancies in the market will remain in December at 10.925M, and the growth of this indicator may become a necessary positive signal before the upcoming US Federal Reserve meeting.

Support and resistance
The asset is corrected within the rising global channel, moving towards the resistance line. Technical indicators maintain a growing buy signal: indicator Alligator’s EMA fluctuations range expands, and the histogram of the AO oscillator forms new upward bars.

Resistance levels: 116, 117.2.
Support levels: 114.8, 113.6.​

 

[SOLIDECN]

Brent Crude Oil, US rejection of Russian oil supports prices​

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Prices on the oil market continue to rise. On Monday, quotes rose above 135 but then corrected downwards. At present, the positive dynamics of the instrument have resumed against the backdrop of the US imposing a ban on the import of "black gold" from Russia. The UK authorities announced similar measures planned to be implemented by the end of this year. The EU expects to abandon Russian oil even later, as it cannot yet find an adequate replacement. According to experts from The Goldman Sachs Group Inc., last year, Russia provided 11% of the world's energy consumption, so the current actions of the US administration cause investors to fear that the shortage of "black gold" in the market will increase and push prices up.

In the medium term, the trend towards long-term growth is unlikely to change, especially since the participants of the OPEC+ agreement are not in a hurry and cannot increase oil production due to the lack of technical ability. Under these conditions, the US administration is betting on negotiations with Iran and releasing part of the strategic reserves for sale but the effectiveness of these steps to curb the growth of quotations is still doubtful. For weeks, US officials have been saying that the "nuclear deal" is close to being finalized but no deal has yet been signed. Also, after the sanctions restrictions are lifted from Iran, it will take a long time to expand production capacities and increase energy supplies to the market. The sale by consumers, led by the US, of 60M barrels of oil from reserves in the current environment may lead to a price correction but is unlikely to reverse the uptrend.

The growth dynamics of Brent Crude Oil quotations may slow down soon, as spring has begun in the main consumer countries, and at this time, the need for active use of energy carriers is traditionally reduced.

Support and resistance
The price consolidated above 125.00 (Murrey [6/8]), which allows growth to 137.50 (Murrey [7/8]), 140.00, 150.00 (Murrey [8/8]). After a reverse breakdown of 125.00, a correction to the area of 112.50 (Murrey [5/8]) is not ruled out but its potential looks limited since the indicators generally signal the continuation of the upward trend: Bollinger bands reverse upwards, and the MACD histogram grows in the positive zone.

Resistance levels: 137, 140, 150.
Support levels: 125, 112.5, 100.​

 

[SOLIDECN]

NZDUSD, consolidation at local highs​

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New Zealand dollar has been showing near zero trend against US dollar in the Asian session, consolidating around 0.6830. The day before, NZDUSD tried to show corrective growth amid some improvement in investor sentiment regarding the prospects for a diplomatic scenario for resolving the conflict in Ukraine, but so far significant risks remain.

Quotes of the asset are also supported by positive macroeconomic statistics from New Zealand and China. New Zealand Manufacturing Sales volumes corrected to 8.2% in Q4 2021 after declining by 6.6% in the previous quarter. Chinese statistics recorded a steady increase in Consumer Prices, indicating a resumption of economic recovery: in February, the figure increased by 0.6% in monthly terms and by 0.9% in annual terms, which was better than market forecasts (0.3% MoM and 0.8% YoY). In turn, the data released today turned out to be more pessimistic. Electronic Card Retail Sales in New Zealand showed a sharp decline of 7.8% in February after rising by 3% in January, although analysts had expected zero dynamics. In annual terms, sales volumes slowed down from 5.7% to 1.1%, which also turned out to be worse than preliminary market forecasts at 9.6%.

Support and resistance
Bollinger Bands on the daily chart show a steady increase. The price range is slightly narrowing, reflecting the ambiguous dynamics of trading in the short term. MACD is trying to reverse downwards, forming a weak sell signal (the histogram is trying to consolidate below the signal line). Stochastic shows a more confident decline, signaling in favor of the development of corrective dynamics in the nearest future.

Resistance levels: 0.684, 0.6866, 0.69, 0.6924.
Support levels: 0.6795, 0.6766, 0.6732, 0.67.​

 

[SOLIDECN]

USDJPY, the US dollar develops "bullish" dynamics​

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The US dollar shows active growth against the Japanese yen during trading in Asia, developing a confident "bullish" momentum formed at the beginning of the week. The American currency is testing the level of 116.00 for a breakout and renews the local highs from February 10.

The growth of the US dollar is still supported by low investor demand for risk against the backdrop of the deteriorating geopolitical situation in Eastern Europe. A special military operation in Ukraine, initiated by Russian President Vladimir Putin, has been going on for two weeks, but so far there has been no noticeable progress in resolving the issue, and diplomatic efforts have not led to any changes. Meanwhile, Western sanctions pressure on Russia is only increasing. Against this background, commodity prices, especially oil prices, are actively rising, which is likely to act as a driver for inflation growth in the short term. The US Core Consumer Price Index, due today, is projected to hit 7.9% in February, compared with 7.5% a month earlier.

Pressure on the yen is provided by uncertain macroeconomic statistics from Japan. Yesterday's data indicated a slowdown in the country's GDP in Q4 2021 from 1.3% to 1.1%, while analysts expected an acceleration to 1.4%. In annual terms, the growth rate of the Japanese economy decreased from 5.4% to 4.6%, which also turned out to be worse than market forecasts at 5.6%.

Support and resistance
Bollinger Bands in D1 chart show weak growth. The price range is expanding but it fails to conform to the surge of "bullish" sentiments at the moment. MACD indicator is growing, while preserving a rather stable buy signal (located above the signal line). Stochastic demonstrates similar dynamics; however, the indicator line is located in close proximity to its highs, indicating the risks of the instrument being overbought in the ultra-short term.

Resistance levels: 116.34, 116.6, 117.
Support levels: 116, 115.75, 115.28, 115.​

 

[SOLIDECN]

WTI Crude Oil, prices retreat from record highs​

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During the Asian session, WTI Crude Oil shows ambiguous dynamics, consolidating near the level of 107.
Yesterday, the instrument was steadily declining in response to statements by representatives of the United Arab Emirates about a possible increase in production by the cartel under the OPEC+ agreement. After the crisis of supply and demand that arose against the backdrop of the COVID-19 epidemic, the alliance established a gradual increase in the production of "black gold" by 400K barrels per day every month. As the world economy recovers, and given the risks of losing supplies from Russia, it is assumed that the pace can be increased to 800K barrels per day. Earlier, the United States announced a ban on importing Russian energy carriers against the backdrop of a special military operation by the Russian Federation on the territory of Ukraine. Europe cannot yet join this embargo, but EU leaders favor gradually reducing dependence on Russia in the energy sector.

The report published yesterday by the US Department of Energy on the reserves of "black gold" for the week of March 4 moderately supported the quotes. The index fell by 1.863M barrels after falling by 2.597M barrels, while analysts had expected a decrease of 0.657M barrels.

Support and resistance
On the daily chart, Bollinger Bands grow moderately: the price range narrows but remains quite spacious for the current level of activity in the market. The MACD reversed downwards and formed a strong sell signal (the histogram is below the signal line). Stochastic shows similar dynamics but is rapidly approaching its lows, signaling that the asset may become oversold in the ultra-short term.

Resistance levels: 108.5, 110, 114.51, 118.
Support levels: 105, 103, 100, 96.​

 

[SOLIDECN]

Gold Settles Near 2,000 USD​

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Volatility remains highly elevated, especially in commodities.
Gold advanced 1% on Thursday, jumping back above the psychological 2,000 USD as the war in Ukraine and inflation concerns support the bullion.

Danske Bank said in a note that it does not expect the Russia-Ukraine conflict to spread to other countries and sees commodity prices broadly moderating over the next six months.

"We expect the Ukrainian and Russian leaders to agree on a truce eventually. However, we also believe that the Ukrainian government will be forced to painful concessions in the absence of direct military intervention by the West/NATO," it said.

Later today, the US CPI inflation for February is due, seen rising further to 7.9% yearly, while the core inflation is expected to accelerate to 6.4%. As a result, the Fed will be forced to raise rates faster as inflation rises, potentially moving beyond 10% on soaring commodities.

The short-term support could be seen at yesterday/today's lows near 1,975 USD. As long as the metal trades above that, the outlook seems bullish, likely targeting the current cycle highs at 2,060 USD.

However, if markets receive more optimistic news from the diplomatic talks between Russia and Ukraine, profit-taking could bring gold back toward 1,900 USD.​