Forex USD Opruggles to Rurpass 40.6% Febio Around 1.6300 . – Forex and world
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Forex USD Opruggles to Rurpass 40.6% Febio Around 1.6300 .

USDCAD created an impressive bullish rally after the rebound off the 50.0% Fibonacci retracement level of the up leg from 1.2000 to 1.2960 at 1.2485 and is now struggling to surpass the 38.2% Fibonacci of 1.2595 and the 200-day simple moving average (SMA). The RSI indicator is moving sideways at the moment around the neutral threshold of 50, while the MACD is heading north above its trigger line.
In case the pair changes its short-term direction to the upside, the bulls will probably challenge the 200-day SMA at 1.2620 and the broken uptrend line. A break higher could last until the 23.6% Fibonacci of 1.2734 before meeting the 1.2875 resistance level.
Alternatively, any declines may drive the price towards the 50.0% Fibonacci of 1.2482 before the 1.2450 support comes into view. Beneath the latter, the 61.8% Fibonacci of 1.2370 could be another level in focus which, if penetrated, would endorse the bearish outlook.
Turning to the medium-term picture, the pair switched to a negative mode after the drop below the ascending trendline. However, in the short-term view, the pair is showing some improvement and may return to positive movements again.
After a somewhat quiet week due to the lack of economic highlights last week, things kick into high gear this week as central banks and inflation data take center stage.  The RBNZ, BOC, and ECB all meet this week to discuss monetary policy.  Everyone will be watching to see which of the central banks is most hawkish and which (if any) will hike 50bps!  In addition, inflation data is due from China, the US and the UK.  Will China see deflationary pressures?  And will the US put in another new 40-year inflation high?  France also holds its 1st round of elections on Sunday, although the main event seems as if it will be on April 24th.  Also, the beginning of a new quarter means the beginning of earnings season.  US banks highlight the first week earnings.
The Reserve Bank of New Zealand kicks things off for central banks on Wednesday this week.  At its last meeting, the RBNZ hiked the OCR by 25 bps for the third consecutive time to 1%.  The central bank noted that it would begin to unwind out of its holdings from its Large Scale Asset Purchase (LSAP) program.  Inflation stood at 5.9% In Q4 2021, much higher than the central banks target of 1%-3%.  Although only a 25bps hike is expected, there is a chance that the RBNZ could hike by 50bps.
The Bank of Canada is next on the docket to meet on Wednesday of this week.  At its last meeting, the BOC hiked rates for the first time since October 2018 by 25bps to 0.5%.  The central bank noted that it would continue its reinvestment phase, therefore keeping the total amount of bonds on its balance sheet roughly unchanged.  Inflation was 5.7% YoY for February, its highest level since August 1991.  Friday’s March jobs data was strong, as +72,500 new jobs added to the economy.  At this meeting, investors will be watching to see if the central bank begins to unwind its bond holdings.  In addition, a 25bps is expected, however there are strong whispers that the BOC may hike 50bps.
Finally, the European Central Bank meets on Thursday.  At its last meeting, the ECB moved forward the timeline as to when it would end its QE program to Q3, rather than Q4.  The ECB has continued to be dovish since then, as members are concerned about the effects of inflation from the Russia/Ukraine war on household incomes.  However, the latest inflation reading (March) was much stronger than expected at 7.5% YoY vs an expectation of 6.6% YoY and a reading of 5.9% YoY for February.  One has to consider how much longer the ECB can maintain its dovish stance.  Indeed, the ECB minutes released last week showed that “a large number of members held that view that the current high level of inflation and its persistence called for immediate further steps towards normalization of monetary policy”.  This would show there is some pause for concern.  Therefore, traders need to watch for wording as to if the statement (or in the press conference) suggests the possibility of a rate hike some time in Q4 of this year!
French Elections
French elections take place this weekend.  If a candidate gets 50% of the vote, that person is declared the victor.  However, that has never happened.  So why do the elections this weekend matter?  Current President Macron has been leading in the polls for months, however his lead is shrinking to far right-wing candidate Marie Le Pen.  If Le Pen makes it through to the second round, which will be held on April 24th, then based on the current polling, Le Pen is within the margin of error to win.  Traders should watch the outcome of this weekend’s elections.  If Macron does not do well, the Euro may see a dip on Monday.
It’s the beginning of earnings season!  US banks typically kickoff the season, and this quarter is no different.  Some of the larger banks to report include C, GS and MS.  Other important companies releasing earnings are as follows:   DAL, BLK, BBBY, JPM, C, WFC, GS, MS, TSCO, ASC
Economic Data
There is a lot to look at this week in terms of important economic data.  However, the most watched will be the inflation data from China, the US and the UK.  Although still low, China is looking for an uptick in March to 1.2% YoY.  The US is expecting a print of 8.4% YoY, which is much higher than the Fed’s 2% inflation target.  Fed members were out in force last week, hyping up this possibility of a 50bps rate hike at the May meeting.  Could this CPI print confirm it? From the UK, headline CPI is expected to increase to 6.7% in March from 6.2% YoY in February. Although still high, MPC members seem a bit concerned about the impact to household incomes, and therefore, aren’t as hawkish as the Fed.
In addition to the inflation data, other important data this week include GDP and Industrial Production from the UK, Germany’s ZEW, US Retail Sales, and Australian Employment change. Additional economic data due out this week is as follows:
France: Presidential Election (1st Round)
Japan: BOJ Governor Kuroda Speech
China: CPI (MAR)
China: PPI (MAR)
UK: Industrial Production (FEB)
UK: Manufacturing Production (FEB)
Germany: CPI (MAR)
UK: Claimant Count Change (MAR)
Germany: ZEW Economic Sentiment Index (April)
New Zealand: Food Inflation (MAR)
New Zealand: RBNZ Interest Rate Decision
Japan: Reuters Tankan Index (APR)
Japan: Machinery Orders (FEB)
Australia: Westpac Consumer Confidence Index (APR)
China: Trade Balance (MAR)
China: New Yuan Loans (MAR)
UK: Inflation data (MAR)
CA: BOC Interest Rate Decision
Crude Inventories
New Zealand: Business NZ PMI (MAR)
Australia: Employment Change (MAR)
EU: ECB Interest Rate Decision
US: Retail Sales (MAR)
US: Michigan Consumer Sentiment Prel (APR)
Australia: Consumer Inflation Expectations (APR)
China: House Price Index (MAR)
China: Unemployment Rate (MAR)
US: Industrial Production (MAR)
US: Manufacturing Production (MAR)

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