March’s preliminary PMI figures in focus

On a macro-economic level, we highlight the release of the preliminary PMI figures for March on Monday and intend to focus on the Germany’s manufacturing sector. An improvement of economic activity could play an auxiliary role for the EUR, yet EUR traders are expected to keep their attention also on EU expansionary fiscal policy.

EUR/USD’s drop after reaching a peak at the 1.0940 (R1) resistance line, seems to have been halted in today’s Asian and early European session. We tend to maintain a bias for a sideways motion of the pair between the 1.0940 (R1) resistance line and the 1.0760 (S1) support line. The RSI indicator corrected lower yet remains above the reading of 50, implying an easing of the bullish sentiment among market participants. Should the bulls renew their dominance over the pair, we may see EUR/USD breaking the 1.0940 (R1) resistance line and start aiming for the 1.1210 (R2) resistance barrier. Should the bears take over, we may see the pair breaking the 1.0760 (S1) support line and start aiming for the 1.0600 (S2) support level. 

In the UK we place particular focus on the release of the preliminary UK Services PMI figure for March and a possible higher reading could provide some support for the pound as it could imply a faster expansion of economic activity for UK’s critical services sector.  Please note that later on BoE Governor Bailey is scheduled to speak and should he sound dovish enough we may see the pound losing ground, especially after BoE’s interest rate decision last Thursday. BoE in its interest rate decision remained on hold, maintaining its dovish orientation yet at the same time, seemed to be signalling caution towards more rate cuts.

GBP/USD seems to have been correcting higher, yet remaining well between the 1.3045 (R1) resistance line and the 1.2805 (S1) support line. For the time being and given the pair’s motion over the past week, we tend to maintain a bias for a sideways motion of the pair between the prementioned levels. The RSI indicator corrected lower yet remains well above the reading of 50 implying that the bullish sentiment may have eased, but remains present. For a bullish outlook we would require cable to break the 1.3045 (R1) resistance line and start aiming for the 1.3260 (R2) resistance barrier. For a bearish outlook, we would require the pair to break the 1.2805 (S1) support line and start aiming for the 1.2550 (S2) support base.

Autres faits marquants de la journée :

Today we get France’s preliminary Service PMI figure, Germany’s preliminary manufacturing PMI figure, the Eurozone’s preliminary Composite PMI figure, the US’s S&P Manufacturing and Services preliminary PMI figures all for the Month of March. On a monetary level we note the speech by BoE Governor Bailey during today’s American session and in tomorrow’s Asian session the release of the BOJ’s last monetary policy meeting minutes.

As for the rest of the week:

On Tuesday, we get Germany’s Ifo indicators, UK’s CBI distributive trades and the US consumer confidence, all being for March. On Wednesday we get Australia’s CPI rates, Japan’s chain store sales, UK’s CPI rates, the US durable goods orders, all for February, while on a monetary level, we note from the Czech Republic’s CNB repo rate decision. On Thursday, we get from Norway Norgesbank’s interest rate decision, and from the US the final GDP rate for Q4, and the weekly initial jobless claims figure. On Friday, we get from Japan tokyo’s CPI rates for March, UK’s retail sales for February, Germany’s GfK Consumer Sentiment for April, UK’s GDP rate for Q4, France’s preliminary HICP rate for March, Switzerland’s KOF indicator for March, Euro Zone’s Business Climate for March, the US consumption rate for February, the US PCE rates also for February, Canada’s GDP rate for January and the US preliminary University of Michigan consumer sentiment.

EUR/USD Quotidienne

• Support: 1.0760 (S1), 1.0600 (S2), 1.0360 (S3)
• Resistance: 1.0940 (R1), 1.1210 (R2), 1.1480 (R3)

GBP/USD Daily Chart

• Support: 1.2805 (S1), 1.2550 (S2), 1.2350 (S3)
• Resistance: 1.3045 (R1), 1.3265 (R2), 1.3435 (R3)

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