Important Levels to Watch for:

-        Resistance line of 1.13699 and 1.13963.

-        Support line of 1.12845 and 1.12481.

Commentary/ Reason:

  1. The euro slipped 0.15% to $1.13079, leaving it near the middle of its range of the past week. The pair fell overnight as low as $1.12906 for the first time since Jan. 10.

  2. The euro was weighed after a weaker-than-expected PMI data showed the Eurozone business activity growth slowed to an 11-month low.

  3. Investors also turned to the U.S. dollar ahead of the Federal Reserve's policy statement due Wednesday. Fed officials are expected to signal their first interest-rate hike since 2018 to combat inflation, paving the way for a March move.

  4. While at the same time, the ECB is seen slower than other major central banks in tightening monetary policy.

  5. Substantial geopolitical risks in Ukraine also increased safe-haven demand for the greenback.

  6. In the short term, the bias is skewed to the downside. Technical indicators offer no clear signs. The EUR/USD pair continues to move sideways, looking vulnerable. The pair is under pressure but the rebound back above 1.1285 was a positive development for the euro. A consolidation below 1.1285 should clear the way for more losses with next target at 1.1265.

  7. On the upside, the 1.1350 area continues to limit any move higher. The mentioned area is reinforced with the 20-day simple moving average.




Important Levels to Watch for:

-        Resistance line of 0.91686 and 0.91899.

-        Support line of 0.90998 and 0.90785.

Commentary/ Reason:

  1. The dollar grinds higher around 0.91597 franc, up 0.30% on the day.

  2. The dollar firmed following a slight jump in the T-note yields today, though traders still nervous about the much-watched Federal Reserve meeting on Wednesday.

  3. USD/CHF remains sidelined around intraday high, defends two-week-old resistance break at 0.916. Should USD/CHF buyers manage to cross the hurdle, an upside momentum towards Thursday’s peak near 0.918 can’t be ruled out. On the contrary, the 0.910 threshold and November 2021 trough surrounding 0.9078 will be in focus ahead.




Important Levels to Watch for Today:

-        Resistance line of 114.254 and 114.505.

-        Support line of 113.445 and 113.195.

Commentary/ Reason:                                        

  1. The dollar eased slightly to 113.817 on the safe haven the yen, after recovering from a one-month low of 113.477 touched in the previous session.

  2. Rebounding U.S. bond yields on revived the greenback demand and remained supportive of the uptick. The dollar was also underpinned by the growing market acceptance that the Fed will tighten its monetary policy at a faster pace than anticipated. Focus will remain to the outcome of a two-day FOMC meeting.

  3. The safe-haven yen rose slightly against the dollar, with geopolitical risk added a new layer of safe haven support. Escalating worries about both a potential military conflict in Ukraine supported safe haven currencies.

  4. However, weighed on the yen is the news that the Japanese government's advisory panel is set to approve expanding stricter anti-COVID-19 measures to 18 additional regions on Tuesday, putting over 70% of the country under restrictions. The taskforce led by Prime Minister Fumio Kishida is set to formally approve those decisions on Tuesday evening.

  5. The USD/JPY pair re-entered a consolidation range and so price action may now oscillate within this range. Considering bearish divergence condition in in daily MACD, it’s probably already in correction. Break of 113.445 will next target 113.195 support.




Important Levels to Watch for:

-        Resistance line of 1.35755 and 1.36240.

-        Support line of 1.34185 and 1.33700.

Commentary/ Reason:

  1. Sterling was slightly lower against the dollar, traded at $1.34754, down 0.08% on the day, hovering just above a new 1-week low it touched yesterday.

  2. The risk aversion environment continues to favour the greenback. The uncertainty over the rising geopolitical tensions and Fed policy boosted safe havens. A volatile movement occurred as geopolitical risks were escalating in Eastern Europe, while investors were also awaiting the outcome of the US FOMC meeting to be held on Tuesday and Wednesday.

  3. The GBP/USD pair has begun to establish bearish momentum with a rise in selling activity in yesterday’s session. Buyers still remain active, yet longer-term bearish sentiment holds. Momentum indicators have established downward trajectories with further downside potential.