AUD/USD Weekly Forecast (21st March 2022 – 25th March 2022)

Fundamental view:

Australian dollar managed to show a uptrend against the American dollar during the trading course of the week recovering from its previous week loss. The commodity linked currency found support this week with the sentiment seesawing alongside headlines coming from Europe. This week came to end without any progress in the peace talks but on the contrary, with increased fears of a possible nuclear attack and concerns about the effect of the war on global growth and inflation. Additionally upbeat employment data favored the AUD. The country managed to add 121.9K full-time jobs, and while the number of part-time positions was down by 44.5K, the final total was 77.4K – more than doubling the 37K expected. Meanwhile the Unemployment Rate contracted to 4%, while the Participation Rate rose to 66.4%.

Reserve Bank of Australia maintained a “patient” stance, as the central bank has released the Minutes of its latest monetary policy meeting, which brought little new to speculative interest. The Fed has increased fund rate by 25 basis points to 0.50% for the first time since 2018 and meet the market expectation.

In this week, US PPI monthly report on 15th March and Fed Interest Rate Decision on 16th March underpinned the bearish move whereas Australia HPI quarterly report on 15th March, US EIA Crude Oil Stocks Change on 16th March and Australia Employment Change on 17th March underpinned the bullish move of the quote.

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Speech at Mar 21, RBA Governor Lowe Speech at Mar 22, Australia Commonwealth Bank Manufacturing PMI, EIA Crude Oil Stocks Change at Mar 23, US Core Durable Goods Orders monthly report, Initial Jobless Claims at Mar 24, Michigan Consumer Sentiment and Fed Governor Waller Speech at Mar 25.  

AUD/USD Weekly outlook:

Technical View:

 

Last week’s high was 0.31% lower than the previous week. Maintaining high at 0.7417 and low at 0.7165 showed a movement of 252 pips.

In the upcoming week we expect AUD/USD to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 0.7498 may open a clean path towards 0.7584 and may take a way up to 0.7750. Should 0.7246 prove to be unreliable support, the AUDUSD may sink downwards 0.7080 and 0.6994 respectively. In H4 chart simple-w pattern breakout favors prospects of a bullish trend. Also to be noted Bullish harami formation exerts the expectation of uptrend for the pair.

Preference
Buy: 0.7412 target at 0.7631 and stop loss at 0.7241

 

Alternate Scenario
Sell: 0.7241 target at 0.6995 and stop loss at 0.7412

USD/JPY Weekly Forecast (21st March 2022 – 25th March 2022)

Fundamental view:

The US dollar rallied against the Japanese yen during the trading course of the week. Headlines of Russia – Ukraine crisis dominated the financial markets, however it did not show any peace talks progress.  US Federal Reserve monetary policy decision also acted as a major catalyst in driving the market which helped the US dollar. As per expectation, the world’s most powerful central bank hiked key interest rates by 25 bps, by lifting the target range to 0.25%-0.50%. The Fed’s dot plot chart threw a hawkish surprise by showing six more rate increases this year while Chair Jerome Powell said that every meeting is a live meeting.

On the other hand, The Bank of Japan confirmed on Friday what the market has known for some time–the yen will receive little or no support from domestic rate policy in the near future. “Monetary easing is needed to support Japan’s economy halfway through recovery from the pandemic,” said BoJ Chief Haruhiko Kuroda in his press conference after the rate decision. 

In this week, Japan Trade balance on 16th March and  US Initial Jobless Claims on 17th March favored downtrend whereas US PPI monthly report on 15th March and Japan CPI excl. Food and Energy yearly report on 18th March favored uptrend for the pair.

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Speech at Mar 21, BoJ Monetary Policy Meeting Minutes, EIA Crude Oil Stocks Change at Mar 23, Japan Markit Manufacturing PMI, US Core Durable Goods Orders monthly report, Initial Jobless Claims at Mar 24, Michigan Consumer Sentiment and Fed Governor Waller Speech at Mar 25.  

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 1.72% higher than the previous week. Maintaining high at 119.40 and low at 117.31 showed a movement of 209 pips.

In the upcoming week we expect USD/JPY to show a bearish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. Should 117.83 proves to be unreliable support then the pair may fall further to 116.52 and 115.74 respectively whereas a solid breakout above 119.92 will open a clear path upward to 120.70 and then will further raise up to 122.01. In H4 chart, Formation of bearish three drives pattern indicates reversal of the trend creating prospects of a bearish trend Along with a bearish harami formation braces our expectation.

Preference
Sell: 119.09 target at 117.18 and stop loss at 119.97

 

Alternate Scenario
Buy: 119.97 target at 122.00 and stop loss at 119.09

GBP/USD Weekly Forecast (21st March 2022 – 25th March 2022)

Fundamental view:

Cable managed to portray a uptrend after 3 weeks of downtrend, despite a cautious Bank of England (BOE) rate hike. Ukraine crisis dominated the financial markets, but it did not show any peace talks progress. However, during the first half, Optimism over a probable truce between the two gave sigh of relief to risk-sensitive currencies such as the British pound. Market sentiment became sour on Thursday  after officials from both sides reported no significant progress on the negotiations. US Secretary of State Antony Blinken said that Russia may be contemplating a chemical-weapons attack late Thursday. Traders also turned cautious, as US President Joe Biden met with his Chinese counterpart Xi Jinping on Friday to discuss Ukraine. 

US Federal Reserve monetary policy decision also acted as a major catalyst in driving the market which helped the US dollar. The Fed has increased fund rate by 25 basis points to 0.50% for the first time since 2018 and meet the market expectation. On the other hand, The British central bank raised rates by 0.25% for the third straight meeting, although remained hesitant in signaling the future policy path amidst Ukrainian uncertainty and its risks to the country’s growth.

In this week, US PPI monthly report on 15th March and US Retail Sales monthly report on 16th March boosted bearish trend whereas UK Claimant Count Change on 15th March and US Building Permits on 17th March boosted bullish trend for the pair.

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Speech at Mar 21, UK Spring Forecast Statement, EIA Crude Oil Stocks Change at Mar 23, BoE FPC Meeting Minutes, US Core Durable Goods Orders monthly report, Initial Jobless Claims at Mar 24, UK Retail Sales monthly report, Michigan Consumer Sentiment and Fed Governor Waller Speech at Mar 25.

GBP/USD Weekly outlook:

Technical View:

Last week’s high was 0.25% lower than the previous week. Maintaining high at 1.3210 and low at 1.3000 showed a movement of 210 pips.

In the upcoming week we expect GBP/USD to show a bullish trend. The currency pair is trading above the 50 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1.3257 may open a clean path towards 1.3338 and may take a way up to 1.3467. Should 1.3047 prove to be unreliable support, the GBPUSD may sink downwards 1.2918 and 1.2837 respectively. Chart formation of cup and handle pattern in H4 chart favors prospects of a bullish trend. Bullish engulfing pattern formation escalates the expectation for a bullish trend.

Preference
Buy: 1.3171 target at 1.3377 and stop loss at 1.3042

 

Alternate Scenario
Sell: 1.3042 target at 1.2838 and stop loss at 1.3171

EUR/USD Weekly Forecast (21st March 2022 – 25th March 2022)

Fundamental view:

Euro managed to erase some of its previous week’s losses and ended trading around 1.1370 level. Headlines of Russia – Ukraine crisis dominated the financial markets, but it did not show any peace talks progress. However, during the first half, Optimism over a probable truce between the two gave sigh of relief to risk-sensitive currencies such as the Euro. US Federal Reserve monetary policy decision also acted as a major catalyst in driving the market which helped the US dollar. The Fed has increased fund rate by 25 basis points to 0.50% for the first time since 2018 and meet the market expectation, the bank has hinted at seven rate hikes in 2022, that is, one at each remaining monetary policy meeting, and affirmed the commitment to start reducing its $9 Trillion balance sheet after their next meeting. 

Russia wishes to find a diplomatic solution if Kyiv recognizes the independence of the Donbass region through the creation of the People’s Republics of Donetsk and Luhansk. Whereas on contrary, Ukraine made it clear that they would not negotiate “an inch of Ukrainian territory,” according to one of President Zelenskyy’s aides, Ihor Zhovkva.

In this week, US Core Retail Sales monthly report on 15th March and Eurozone Trade Balance n.s.a. on 18th March favored downtrend whereas Eurozone HICP monthly report on 15th March and US Building Permits and Initial jobless claim on 17th March favored the uptrend for the pair.

The major economic events deciding the movement of the pair in the next week are Fed Chair Powell Speech at Mar 21, ECB Non-monetary Policy Meeting, EIA Crude Oil Stocks Change at Mar 23, US Core Durable Goods Orders monthly report, Initial Jobless Claims at Mar 24, Eurozone Ifo Business Climate, Michigan Consumer Sentiment and Fed Governor Waller Speech at Mar 25.

EUR/USD Weekly outlook:

Technical View:

Last week’s high was 0.15% higher than the previous week. Maintaining high at 1.1137 and low at 1.0900 showed a movement of 237 pips.

In the upcoming week we expect EUR/USD to show a bullish trend. The currency pair is trading above the 100 Simple Moving Average and the MACD trades to the upside. A solid breakout above 1.1156 may open a clean path towards 1.1265 and may take a way up to 1.1393. Should 1.0919 prove to be unreliable support, the EURUSD may sink downwards 1.0791 and 1.0682 respectively. Chart formation of a rounding bottom pattern in H4 chart sets prospects for a bullish trend. Three outside up pattern formation in H4 chart escalates the expectation for a bullish trend.

Preference
Buy: 1.1045 target at 1.1264 and stop loss at 1.0914

 

Alternate Scenario
Sell: 1.0914 target at 1.0683 and stop loss at 1.1045