U.S. Dollar Eases Ahead Of Nonfarm Payroll

* DXY index experienced its biggest daily losses ahead of crucial Nonfarm Payroll

* BoE maintain its interest rate level at 5.25%, while hawkish tone supporting the Pound Sterling

* Oil prices eased as talk for Gaza ceasefire advance

Fundamental Overview

U.S. equities rebounded on robust earnings, triggering positive momentum in Asian markets, including Hong Kong and China. 

However, the dollar index faces challenges as it teeters near a critical $103 support level, intensifying uncertainty ahead of the impending Nonfarm Payroll report. This impending release becomes a focal point for market participants seeking crucial labor market insights that could potentially influence the trajectory of the dollar. 

Simultaneously, oil prices are set to close the week with a 5% loss, signaling a de-escalation in Middle East tensions.

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Current rate hike bets on 20th March Fed interest rate decision: 

Source: CME Fedwatch Tool

0 bps (65%) VS -25 bps (35%) 

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Economic Calendar

(MT4 System Time)

Source: MQL5  

Market Movements

DOLLAR_INDX, H4

The Dollar Index experiences a decline driven by technical correction and profit-taking ahead of crucial US jobs data set to be released later today. Initial surges followed US Fed Chair Jerome Powell’s statement ruling out a March interest rate cut, citing a robust economic recovery. Traders are now recalibrating expectations, with a 39% probability of a March rate cut and a 94% chance of a reduction by May, according to the CME FedWatch Tool. 

The Dollar Index is trading lower following the prior retracement from the resistance level. MACD has illustrated increasing bearish momentum, while RSI is at 40, suggesting the index might extend its losses since the RSI stays below the midline. 

Resistance level: 103.85, 104.60

Support level: 103.05, 102.15

GOLD，H4

Following a hawkish Federal Reserve statement, US Treasury yields retreat, boosting gold’s appeal as investors shift focus to rising tensions in the Middle East. The US’s reprisal strikes against an Iranian-backed militia contribute to an atmosphere of geopolitical uncertainty, reinforcing gold’s safe-haven status.

Gold prices are trading higher while currently testing the resistance level. MACD has illustrated increasing bullish momentum, while RSI is at 64, suggesting the commodity might extend its gains after breakout since the RSI stays above the midline. 

Resistance level: 2055.00, 2080.00

Support level: 2035.00,  2020.00

CL OIL, H4

Oil prices tumble as hopes emerge for a resolution in the Israel-Hamas conflict, with reports of a proposal for an extended pause in fighting by Hamas. Meanwhile, the OPEC+ meeting shows limited price impact as the group refrains from changes to production policies, leaving markets to react to geopolitical developments. 

Oil prices are trading lower following the prior breakout below the previous support level. MACD has illustrated increasing bearish momentum, while RSI is at 37, suggesting the commodity might extend its losses since the RSI stays below the midline. 

Resistance level: 75.20, 78.65

Support level: 72.05, 69.85