Caution Advised as the Pound Continues to Fall
08.03.2022
- U.S. 3-Year Treasury Auction
- U.S. Wholesale Inventories (Final Figures)
In the previous day’s U.S. currency trading, the Dollar Index rose to 99.2, gaining ground even against the currencies of commodity-producing nations, which had been hitting new highs day after day. The AUD/USD pair touched a yearly high of 0.744 before falling back by about 130 pips to 0.731.From a technical perspective, since the pair broke above the daily 200-day SMA with a real body and has since retested it, we will be watching closely to see if the AUD/USD pair resumes its upward trend after this pullback.
In the European currency markets, the pound stood out as the weakest currency at the start of the session, with the GBP/JPY pair falling approximately 120 pips from 152.22 to 150.99. Since the GBP/JPY has already broken below its support level on the daily chart, traders should be wary of a further decline toward the next support level around 149.89.
Today, at 4:00 PM, German industrial production; at 6:30 PM, South Africa’s Q4 GDP (final); at 7:00 PM, Eurozone Q4 GDP (final);at 8:00 PM, the U.S. NFIB Small Business Optimism Index; at 10:30 PM, Canada’s trade balance and the U.S. trade balance; at midnight, U.S. wholesale inventories (final); at 3:00 AM, the U.S. 3-year Treasury auction; and at 6:45 AM the following day, New Zealand’s Q4 manufacturing sales. I plan to keep a close eye on these various headline news items while carefully assessing currency strength and weakness.
Author: Keisuke Sakurai
