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Commodities Gold

Gold Pulls Back from All-Time Highs Ahead of Fed Rate Verdict: Will Powell Trigger the Next Rally?

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  • September 17, 2025
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Gold (XAU/USD) is pulling back from all-time highs around $3,703 as market participants wait with bated breath for the Federal Reserve’s interest rate decision, set to offer a 25 basis point reduction. As of writing, the metal trades at about $3,675, pushed lower by a minor US Dollar rebound but underpinned by muted Treasury yields and robust safe-haven buying. Although profit-taking has pulled recent advances, the overall bullish trend is intact, with the Fed’s policy expectation and Powell’s comment guiding whether Gold resumes its advance towards fresh highs or gets into a sharper correction. KEY LOOKOUTS • Everyone expects a 25 bps cut, but even suggestions of more or quicker easing could have a big influence on Gold’s direction. • The tone of Fed Chair regarding inflation, labor market conditions, and future policy direction will be essential for determining market sentiment. • Levels of immediate support are $3,650–$3,645, and resistance levels are $3,675–$3,700, with $3,703 as the primary breakout level. • Geopolitical uncertainties and economic uncertainty remain the drivers of Gold’s bullish thesis in spite of interim corrections. Prices of Gold are settling back from their new all-time highs at around $3,703, with market players waiting for the Federal Reserve’s interest rate decision for the next directional signal. The precious metal is at around $3,675, down fractionally on the day as investors take profits and the US Dollar demonstrates mild firmness. Market expectations are strongly biased towards a 25 basis point rate reduction, but focus will be on Fed Chair Jerome Powell’s direction and the revised economic projections for hints on the speed of future easing. Even as the recent pullback from Gold exists, its broader bullish trend continues to be underpinned by safe-haven demand, tame Treasury yields, and escalating geopolitical and economic uncertainties. Gold drops from record highs of about $3,703 as traders wait for the Fed’s rate move, with markets penciled in for a 25 bps cut. XAU/USD is trading at $3,675, with Powell’s direction set to guide the next major move in prices. The pullback notwithstanding, safe-haven demand still remains bullish for the overall outlook. • Gold pulls back from record highs of about $3,703 as traders hold on for the Fed’s policy move. • XAU/USD is trading at about $3,675, down close to 0.35% on the day. • The markets are forecasting a 25 bps Fed rate cut, bringing the funds rate down to 4.00%-4.25%. • Powell’s press conference and new economic projections will be driving market sentiment. • Support in the immediate vicinity is $3,650–$3,645 and resistance of $3,675–$3,700. • Safe-haven buying, muted yields, and geopolitical tensions support Gold’s overall uptrend. • A dovish Fed may initiate new highs, while caution would risk a more significant correction. Gold is giving a breather to its record-breaking rally, as investors now turn their attention to the Federal Reserve’s interest rate decision. The precious metal’s price has been boosted by hopes of looser US monetary policy, ongoing global uncertainties, and healthy safe-haven demand. Investors are keeping a close eye on how the Fed will weigh slowing job growth and sticky inflation since its policy framework will be instrumental in determining the market direction for the remainder of the year. XAU/USD DAILY CHART PRICE SOURCE: TradingView Aside from monetary policy, Gold is underpinned by broader macroeconomic and political variables. The continued geopolitical tensions, worry about world growth, and increased uncertainty of US politics continue to uphold its status as a safe-haven asset. With major banks expecting several rate cuts through the end of the year, the overall background still supports Gold, and thus the Fed’s guidance is a key event for market players in focus. TECHNICAL ANALYSIS Gold (XAU/USD) is steadying around $3,675 after pulling back from the all-time high of $3,703. Initial support is found at $3,650–$3,645, corresponding to the 50-period SMA on the 4-hour chart, while the resistance is at $3,675–$3,700. A move below support would risk exposing the $3,620 area, while a rebound might force a retest of the all-time high, with possible extension to $3,750. The RSI at 51 indicates neutral momentum after cooling from overbought, while the MACD reflects declining bullish strength, indicating the Fed’s move is likely to be the catalyst for the next big move. FORECAST If the Fed communicates a dovish tone with the broadly anticipated 25 bps rate cut, Gold may get back into gear and test the record high of $3,703. A firm breakdown above this level may set the path towards $3,750 and beyond, backed by safe-haven demand, muted yields, and forecasts of additional policy accommodation. Increased geopolitical risk or indications that the US economy is weakening can further drive buying interest. Conversely, if Powell’s advice is conservative or reduces expectations on the extent of future cuts, Gold could attract selling pressure again. Breaking below the $3,650 support area could reveal lower levels around $3,620 and the psychological $3,600 level. A sharper US Dollar recovery or a reduction in geopolitical tensions could also deter bullion, bringing in a longer-term corrective phase before any new rally attempt.

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Commodities Gold

Gold Price Holds Above $3,300 Amid Tariff Tensions and Fed Policy Uncertainty

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  • July 8, 2025
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Gold prices remain resilient above the $3,300 level amid a complex mix of global economic and political factors. While diminishing hopes for a July Fed rate cut and Trump’s renewed tariff threats exert downward pressure, ongoing concerns over US fiscal stability and rising global risk aversion continue to support safe-haven demand for the yellow metal. US Dollar volatility contributes to the uncertainty, with gold prices stuck in a trading range until the more definitive indications from the FOMC meeting minutes ahead. There were no major economic data releases and market sentiment is being shaped predominantly by geopolitical events and US monetary policy expectations. KEY LOOKOUTS •  The issuance of tariff deadline extensions and aggressive threats against BRICS-aligned countries are intensifying concerns of international trade disruption, weighing on market sentiment. • Increasing expectations of sustained high interest rates based on expected inflation from tariffs are dampening gold’s potential upside. • As the USD reached a two-week high, fiscal worries and risk aversion are limiting further advances, providing minimal support for gold prices. • Resistance at $3,347–$3,360 and support at $3,295–$3,270 are key levels to watch for traders as gold looks for direction in a muddled fundamental environment. Gold prices are under modest pressure but stay firm above the $3,300 level as markets absorb mixed signals on the global and domestic fronts. The fading prospects of a July Fed rate cut due to inflation fears fueled by Trump’s brash tariff policy is limiting the non-yielding metal’s upside momentum. Yet safe-haven demand remains as a result of mounting geopolitical tensions, doubt over US fiscal health, and widespread risk aversion across global equity markets. Meanwhile, a weakening US dollar acts to offset gold’s losses, with market players now looking to the coming FOMC meeting minutes for clearer direction on the Federal Reserve’s policy direction. Gold price lingers near $3,300 as markets balance ebbing Fed rate-cut hopes against increasing global risk aversion. Tariff threats by Trump and a tempered US Dollar cap losses, holding gold firm in advance of key FOMC minutes. •  Gold holds above $3,300 despite small intraday declines, buoyed by safe-haven demand. •  Ebbing hopes for a July Fed rate cut weigh on the non-yielding metal due to inflation worries. •  Trump’s prolonged tariff threats against BRICS-aligned countries increase global economic insecurity. •  The US Dollar hit a two-week peak but finds it difficult to rise further on fiscal and trade-related concerns. •  Insufficient aggressive bearish bets on gold indicate investors remain cautious amid conflicting market cues. •  Technical resistance around $3,347–$3,360 caps upside, whereas support at $3,295–$3,270 remains pivotal. • Market attention turns to FOMC minutes for more precise guidance on the Fed’s next rate trajectory and USD direction. Gold prices are stable above the $3,300 level as investors remain conservative in light of increasing global uncertainties. US President Donald Trump’s return to threats to impose higher tariffs—particularly on nations aligning with BRICS—has renewed apprehension regarding global trade disruptions and inflation. This change in trade policy has not just shaken market sentiment but also made it more difficult for the Federal Reserve’s strategy, as policymakers might now be required to hold higher interest rates for a longer period than expected to suppress inflationary pressures. XAU/USD DAILY PRICE CHART SOURCE: TradingView Simultaneously, the US Dollar has also indicated strength but is held back by perceptions related to the fiscal health of the country and the general impact on the economy of tariff hikes. The dearth of specific economic data during the early part of the week has kept markets focused on wider geopolitical events and future policy guidance from the Federal Reserve. Here, gold is still taking advantage of its safe-haven demand, as global equities are experiencing distress and investor sentiment remaining weak. TECHNICAL ANALYSIS Gold is running into resistance at the $3,347-$3,348 level, which is around the 100-period Simple Moving Average (SMA) on the 4-hour chart. A continued advance beyond this level may trigger short-covering and send prices to the $3,360 supply zone, with a break-out opening up the psychological $3,400 mark. To the downside, near-term support is in the $3,300–$3,295 area, which has thus far managed to cap further declines. A firm fall through this level may fan selling pressure, leading the metal to the next major support at $3,270, and even lower down to June’s low around $3,247. FORECAST If gold can clear the near-term resistance at $3,348 and hold on for more than the $3,360 supply zone, it may signal a bullish breakout. This could draw in new buying interest, creating a short-term rally toward the $3,400 psychological level. Ongoing global risk aversion, ongoing geopolitical tensions, or any dovish comments from the upcoming FOMC minutes could further fuel the upside path for gold. On the other hand, if gold is unable to sustain the $3,300–$3,295 support level, it can expect to come under more selling pressure. A firm break below the range can pave the way to the $3,270 support level, and more losses can bring the price down to the June swing low of approximately $3,247. A stronger US Dollar, hardline Fed perspective, or decline in global tensions can serve as triggers for this bearish move.

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Commodities Oil – US Crude

WTI Crude Oil Fights Near $66 as Trump’s Tariff Expiration Date Threatens International Demand Prospect

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  • July 4, 2025
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West Texas Intermediate (WTI) crude oil hovers with caution at around $66.00 as the market remains in suspense before the July 9 tariff deadline announced by U.S. President Donald Trump. With Trump assuring not to extend the deadline for those countries who are not able to agree on a trade deal with Washington, threats of retaliatory tariffs hang over global trade and energy demand. While the U.S. managed to conclude deals with the UK, Vietnam, and Canada-China framework, uncertainty over other important partners such as the Eurozone, Japan, and Canada continues to put pressure on oil markets. Also, robust U.S. jobs data have decreased prospects of a Federal Reserve rate cut this month, further capping oil price upside potential. KEY LOOKOUTS • Market attention is still on President Trump’s order to apply tariffs to countries that do not have trade agreements, which may weaken global oil demand. • Success or collapse in talks with large economies such as India, the Eurozone, Japan, and Canada will have a major impact on market mood. •  Weaker market bets on a July interest rate cut by the Federal Reserve, following strong NFP data, may limit WTI’s upside. • Concerns over global trade disruptions continue to cloud the outlook for energy consumption and future oil price stability. WTI crude oil prices are hovering around the $66.00 mark as markets react cautiously to the looming July 9 tariff deadline set by U.S. President Donald Trump. With Trump insisting that nations that cannot close trade agreements will receive no extensions, investors are growing more worried about the possible effect of back-and-forth tariffs on worldwide trade and oil consumption. Although agreements with the UK and Vietnam have been completed and a framework with China has been reached, doubt surrounding agreements with large partners such as India, Japan, and the Eurozone keeps the market in suspense. In addition, disappointing hopes for a Federal Reserve rate reduction—sparked by better-than-forecast U.S. jobs data—have further hindered crude’s short-term bounce prospects. WTI crude oil trades cautiously at $66 as markets watch how the July 9 tariff deadline will play out with Trump. Fears of weaker global demand and lower Fed rate cut hopes are curtailing price momentum. Investors continue to watch trade developments with major global trading partners. • WTI crude oil trades close to $66 in the context of careful market sentiment. • Trump reaffirms there is no extension of the July 9 tariff deadline on unexpired trade agreements. • Threats of tariffs cast doubts about global trade disruption and energy demand. • Trade agreements concluded with UK, Vietnam, and an outline with China. • Uncertainty still hangs about deals with India, Japan, Eurozone, Canada, and Mexico. • More resilient U.S. NFP data lowers the chances of a Fed rate cut in July. • Oil price potential capped as global demand outlook is still under pressure. West Texas Intermediate (WTI) crude oil is trading cautiously because market participants closely follow the soon-to-be-exceeded July 9 tariff deadline announced by U.S. President Donald Trump. His assurance that there will not be an extension of this deadline has increased the fear of an escalation in trade tensions. Investors are most concerned with how retaliatory tariffs affect the pattern of global trade flows, potentially destabilizing the economy and, indirectly, energy consumption. While the U.S. has attained trade deals with the United Kingdom and Vietnam and achieved a framework agreement with China, having no agreed deals with other large economies such as the Eurozone, Japan, Canada, and India is also fuelling market uncertainty. WTI CRUDE OIL DAILY CHART PRICE SOURCE: TradingView Aside from the trade issues, the spotlight has been pointed towards the U.S. Federal Reserve’s policy environment. The stronger-than-anticipated Nonfarm Payrolls release has prompted investors to dial down forecasts for a rate cut during the next policy session. This monetary policy change of heart has instigated a cautious environment among investors. As geopolitical and economic considerations remain the chief news-makers, the overall market is paying attention to how world leaders will manage the fine line of trade relationships in the days ahead. TECHNICAL ANALYSIS WTI crude oil is resisting at the $66.50 level, with buyers still failing to maintain their upticks over this range. The rebound from the weekly low of $64.00 indicates modest bullish interest but is tempered by failure to sustain buying, suggesting caution in the face of overall market uncertainties. Support is currently at $64.00, and a breach below this area could leave WTI vulnerable to further declines towards the zone of $62.80. On the positive side, a decisive breakout above $66.50 would set the stage for a challenge of the $68.00 level, but the broader trend is susceptible to trade and monetary policy-related fundamental headlines. FORECAST If the tensions in trade are reduced with successful last-minute agreements between the U.S. and leading partners such as India or Japan, WTI crude may get bullish traction. A break above the $66.50 resistance level could see a slow run-up towards $68.00 and even $69.20. Favorable geopolitical events or surprise supply disruptions may also enhance the up move, provided market sentiment picks up and global demand worries abate. On the negative, a failure to negotiate further trade agreements by the July 9 deadline could spur a wave of retaliatory tariffs, sapping global economic optimism and pulling oil prices down. A breach of the $64.00 support level may set the stage for a fall to $62.80 and maybe even $61.50. Further cuts in Fed rate cut hopes and better U.S. dollar performance might also bear down on oil, keeping WTI in sustained pressure.

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Commodities Oil – US Crude

WTI Crude Oil Remains Near $73 as Strait of Hormuz Geopolitics Increases Supply Disruption Concern

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  • June 18, 2025
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West Texas Intermediate (WTI) crude oil is trading near $73.00 after dipping from recent peaks, with risks to the downside seeming minimal owing to growing Middle Eastern geopolitical tensions. Increased concerns of supply disruptions in the Strait of Hormuz, through which roughly 20% of the world’s seaborne oil travels, are buoying oil prices. The tensions ran hotter after the previous President Donald Trump demanded Iran’s “unconditional surrender” and America escalated its military build-up in the region. In the meantime, markets look to the U.S. Federal Reserve to raise interest rates this week, but potential cuts later in the year as fears of global growth worsen. KEY LOOKOUTS • Heightened conflict among the U.S., Iran, and Israel could result in possible supply disruptions via the critical Strait of Hormuz. • Former President Trump’s demand for Iran’s “unconditional surrender” and heightened U.S. military operations could exacerbate market volatility further. • The Fed is likely to maintain rates at 4.25%-4.50%, but subsequent cuts in September or even July are still in the spotlight. • Even though there have been recent pullbacks, supply worries and geopolitical tensions can curtail downside action in WTI prices around the $73.00 level. WTI crude oil prices are still bearish around the $73.00 handle after surrendering some of the sharp advances on Tuesday, fueled by the renewed specter of supply interference in the Strait of Hormuz—a critical shipping channel for global oil exports. Geopolitical tensions have heightened after former President Donald Trump’s call for Iran’s “unconditional surrender” and news of heightened U.S. military deployments within the region. The prospect of an expanded conflict between Israel and Iran is fueling the anxiety in the market. In the meantime, focus turns to the U.S. Federal Reserve’s forthcoming rate decision, with investors keen to see cues regarding the timing of potential interest rate reductions later this year. WTI crude oil fluctuates at $73.00 as supply fears from the Strait of Hormuz cap losses. Geopolitical tensions between Iran and U.S. military actions fuel market fear, as investors wait for the Fed’s interest rate move. • WTI crude oil trades at around $73.00, pulling back slightly after a 5% rise led by supply fears. • Strait of Hormuz tensions flare, with concerns of interrupted global oil flow through the critical chokepoint. • Ex-President Trump demands Iran’s “unconditional surrender”, heightening geopolitical uncertainty. • U.S. sends additional fighter jets, further buttressing its presence in the Middle East in rising tensions. • Israel can step up military activity against Iran, further increasing regional instability. • The Fed is likely to keep rates at 4.25%-4.50% in its next meeting. • Markets factor in expected rate cuts by September or sooner, as global growth fears return. West Texas Intermediate crude oil is still in the limelight as tensions geopropolitically in the Middle East continue to escalate. Former U.S. President Donald Trump’s recent statement calling for Iran’s “unconditional surrender,” along with heightened U.S. military deployment across the region, has further raised fears of possible conflict. The Strait of Hormuz, which carries almost one-fifth of the world’s seaborne oil, is central to these fears, as any disruption would have a serious impact on international supply chains. With Iran said to be making overtures to neighboring nations to garner diplomatic support, the situation remains unstable and closely monitored by international markets. WTI CRUDE OIL DAILY PRICE CHART SOURCE: TradingView At the same time, market participants are focusing on the U.S. Federal Reserve’s next interest rate decision. Even though rates are universally predicted to stay flat in the short term, speculation is building on next policy steps, especially in reaction to diminishing global economic momentum. Analysts propose that sustained geopolitical uncertainties, combined with dimmed growth projections, may be enough to get the Fed to act prematurely. This combination of global stress and monetary policy uncertainty is having energy markets nervous, with investors considering both supply risk and economic indicators. TECHNICAL ANALYSIS WTI crude oil is consolidating around the $73.00 level following a steep rally in the last session. The price is just above its near-term support area, and any substantial advance beyond the $74.00 level could set the stage for a test of the $76.00 resistance. On the negative side, the initial support is around $71.50, followed by a firmer floor at $70.00. Momentum oscillators such as the RSI are neutral to weakly bullish, hinting at consolidation with a potential upside bias if geopolitical tensions continue to simmer and buying interest returns. FORECAST WTI crude oil could experience fresh upside strength if tensions in the Middle East continue to rise, especially around the Strait of Hormuz. Any confrontation or interference in oil shipping channels might spark a sudden surge in oil prices, which could lead WTI to the $76.00–$78.00 level. Secondarily, if the U.S. Federal Reserve hints at dovish policy adjustments or rate cuts earlier than anticipated, that might destabilize the dollar and prop up commodity prices, including crude. On the negative side, WTI would risk pressure if diplomatic measures relieve tensions between Iran and America, or if transit of oil through the Strait of Hormuz remains unobstructed. Additionally, should global economic metrics continue to decline without proper stimulus, fear of diminished oil demand would send prices south. Under these circumstances, WTI would retest the levels around $71.50 and even move down towards the psychological $70.00 level.

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Currencies

USD/CAD Approaches 1.3800 Due to Diplomatic Market Sentiment and Expectation of Fed Interest Rate Decision

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  • May 7, 2025
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USD/CAD currency pair has risen towards 1.3800 since investors take a conservative approach following the Federal Reserve’s expected interest rate decision. Although the Fed is likely to leave rates unchanged, market focus is on comments by Chair Jerome Powell in light of existing trade tensions and political pressure from President Trump. The Canadian Dollar (CAD) is encountering some headwinds even as risk sentiment has improved in the wake of a joint press conference between Canadian Prime Minister Mark Carney and US President Donald Trump. Nonetheless, concerns about Canada’s domestic economic data, such as a sharp decline in the Ivey PMI, are dragging the CAD down. In the meantime, senior-level negotiations between US and Chinese officials will be held in Geneva, further complicating global trade dynamics. KEY LOOKOUTS • Market participants will be watching closely for the Fed’s interest rate move and Chair Jerome Powell’s remarks, especially on possible future rate cuts and the economic effects of continued trade tensions. • The result of US-Canada trade talks, particularly after the joint press conference between President Trump and Prime Minister Carney, will be instrumental for the CAD. Any news on tariffs or trade deals could have a strong impact on the pair. • The high-level meeting between US Treasury Secretary Bessent, Trade Representative Greer, and Chinese Vice Premier He Lifeng in the coming days may shift global trade sentiment, impacting the USD and CAD. • The steep fall in Canada’s Ivey PMI indicates diminishing business sentiment, and further dismal economic data will place extra stress on the CAD in the short term. USD/CAD pair moves towards 1.3800, market participants stay nervous in anticipation of the Federal Reserve interest rate decision, with market focus on Chair Jerome Powell’s remarks on potential rate cuts and their implications during the prevailing uncertainty over trade. The result of US-Canada trade negotiations, especially after the recent encounter between Prime Minister Mark Carney and President Donald Trump, is also a critical consideration, since any development or reversal in tariff negotiations may impact the CAD’s performance. Also, the high-level US-China trade talks scheduled this weekend might affect global risk sentiment, impacting both currencies in turn. At the same time, Canada’s weak Ivey PMI provides a hint that business sentiment may slow down, exposing the CAD to more downward risks if domestic economic indicators remain weak. USD/CAD currency pair is moving towards 1.3800 as market focus shifts to the Federal Reserve interest rate decision and US-China-Canada trade negotiations. Canada’s softening economic indicators, led by a steep decline in the Ivey PMI, put more pressure on the CAD. •  The pair is quoted at 1.3790, making up losses from the last session as the US Dollar strengthens. •   Market players are wary in front of the Federal Reserve interest rate decision, with the expectation of no change but increased focus on Chair Jerome Powell’s testimony. •   President Trump keeps putting pressure on the Fed for possible rate cuts, which shifts market mood. •  Recent Canadian PM Mark Carney press conference with US President Trump indicated positive negotiations, with more discussions to follow at the G7. •  US Trade Representative Greer and Treasury Secretary Bessent are sitting down with Chinese Vice Premier He Lifeng in Geneva in a breakthrough meeting of international trade tensions. •  Canada saw its business sentiment decline steeply in the April Ivey PMI. •  Gaining risk appetite across the world lifted the Canadian Dollar, even if global trade issues continue to put a strain on domestic concerns. Investors are keeping a close eye on events on several fronts as the USD/CAD currency pair stays flat in anticipation of major economic and political developments. The attention is mainly on the forthcoming Federal Reserve interest rate announcement, where markets expect nothing to change but remain sensitive to comments from Chair Jerome Powell, particularly against the backdrop of continuing trade tensions and political pressure from President Trump. These remarks are likely to offer hints on the Fed’s next policy course and how it will deal with inflation issues and world economic uncertainty. USD/CAD DAILY PRICE CHART CHART SOURCE: TradingView Aside from the Fed, the global trade dynamic is also largely influencing market sentiment. Top-level meetings are scheduled to be held in Geneva between US and Chinese officials as there are indications of easing trade tensions. In the meantime, US President Donald Trump and Canadian Prime Minister Mark Carney have engaged in renewed discussions on trade, providing guarded optimism. That said, Canada’s soft business activity readings, notably the recent Ivey PMI reading, challenge the momentum of the country’s economy, reflecting the delicate dance between forward progress externally and trouble internally. TECHNICAL ANALYSIS USD/CAD is proving resilient as it lingers close to the 1.3800 level,  a landmark psychological resistance area. A prolonged break over this level would indicate more bullish strength, even opening the doors to recent highs. On the bearish side, near-term support is currently at 1.3730–1.3750, where buyers had earlier stepped in. Traders will be awaiting a clear breakdown or rejection around 1.3800 in order to identify the next direction bias, considering that upcoming fundamental drivers such as the Fed decision will drive volatility in the markets. FORECAST USD/CAD pair breaks and holds above 1.3800 resistance level, it might reflect renewed bullish push, and have the possibility of testing higher levels of 1.3850 and possibly 1.3900 in short term. Such move may find support due to sustained demand for US Dollar with global uncertainty, dovish Fed tone, or soft Canadian economic indicators. Upside developments in US-China or US-Canada trade negotiations may also enhance investor sentiment in the USD, adding to the pair’s upward pressure. Conversely, inability to hold above 1.3800 may lead to a corrective pullback, with initial support at the 1.3750 region. A breakdown below this region may see further declines towards 1.3700 or even 1.3660 if risk appetite improves or Canadian data begins to show signs of recovery. Any dovish tone from the Fed or breakthroughs in trade talks that benefit the Canadian economy could also pressure the

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Currencies EUR/USD

EUR/USD Falls Below 1.0950 as Fed Decision Approaches Amid Strength in Dollar and Eurozone Trends

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  • March 19, 2025
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The EUR/USD crossed below the level of 1.0950 during Wednesday morning’s Asian trading, staying at around 1.0935 as market participants take a guarded approach ahead of the U.S. Federal Reserve interest rate determination. The U.S. Dollar received mild lift from more solid industrial production, contributing to traders’ expectation amid the Fed’s revised rate guidance and economic report. Although the central bank is expected to leave interest rates on hold, the press conference and dot-plot that accompany it could provide key policy guidance. Separately, a large spending budget passed by Germany’s parliament could support the Euro, indicating increased investment activity in the Eurozone’s largest economy. KEY LOOKOUTS • Markets watch for the Fed’s rate move and economic forecasts, which will determine the tone of USD movement going forward. • Robust US industrial production figures support the Dollar; additional strength could put pressure on EUR/USD below significant support levels. • Bundestag approval of a significant spending increase could underpin the Euro and restore investor confidence in the Eurozone economy. • Traders are cautious ahead of Fed commentary; increased volatility anticipated after the decision, affecting short-term EUR/USD direction. As the EUR/USD currency pair declines below 1.0950 in anticipation of the highly expected Federal Reserve interest rate decision, market players are keenly observing major events that may influence the near-term direction. The US Dollar has strengthened after positive industrial production figures, increasing hopes for a more aggressive Fed policy. Investors will closely monitor the Fed’s revised economic forecasts and the dot-plot, which may provide key information on the rate path ahead. In the meantime, Germany’s approval of a huge spending budget brings a possible Euro boost, signaling fresh fiscal support for the Eurozone’s biggest economy. Overall, sentiment is still wary, with volatility set to spike after the Fed announcement. EUR/USD falls below 1.0950 as traders wait for the Federal Reserve to make its interest rate decision and revise its economic forecasts. The stronger US Dollar and Germany’s recently approved budget plan are significant drivers of the pair’s movement. Volatility is likely to increase after the Fed announcement. • EUR/USD falls to about 1.0935 during Wednesday’s Asian session, falling below the 1.0950 mark. • Investors stay on guard in anticipation of the Federal Reserve interest rate announcement and economic forecasts later today. • The Fed will likely keep interest rates unchanged, but the dot-plot and press conference can give hints of future policy directions. • US Dollar appreciates slight strength as underpinned by better-than-expected US industrial production data for February (+0.7% MoM). • Germany’s parliament sanctioned a big spending spree, a sign of possible economic recovery in the Eurozone’s biggest economy. • Market sentiment remains divided, with investors in wait-and-watch mode following the Fed announcement. • Greater volatility anticipated in EUR/USD in the wake of the Fed verdict and reports on inflation projections. The foreign exchange market is in wait-and-watch mode with international investors awaiting the coming interest rate verdict of the U.S. Federal Reserve. Though the central bank is mostly expected to leave interest rates as they are, everyone is looking forward to the press conference and new economic projections for clues on the course of future monetary policy. The latest release of robust industrial production numbers in the U.S. has contributed to the expectation, signaling strength in the economy and adding to further interest in the central bank’s inflation and growth outlook. EUR/USD Daily Price Chart Chart Source: TradingView In the meantime, European developments have ushered in a tide of optimism, as Germany’s parliament passed a big-ticket spending plan designed to spur investment. The action is likely to underpin economic recovery efforts in the Eurozone’s biggest economy and potentially bolster market confidence in the region’s growth prospects. With traders waiting on the sidelines for key policy signals, the overall market tone is set by the interplay between U.S. economic vigor and Europe’s revived fiscal efforts. TECHNICAL ANALYSIS EUR/USD is picking up signs of mild weakness following its fall below the 1.0950 level, reflecting cautious market sentiment pre-Fed decision. The pair is now trading close to 1.0935, with near-term support at the 1.0900 psychological level. A break through this region may pave the way for further bear pressure. On the higher side, resistance is expected to be encountered in the 1.0975–1.1000 area, where sellers are likely to re-enter. Overall, the price action indicates a consolidation period, with investors waiting for a clear direction of breakout after major economic indicators from the U.S. Federal Reserve. FORECAST If the U.S. Federal Reserve keeps its policy statement and economic forecasts neutral or dovish, it may cap further gains in the U.S. Dollar. In this context, the Euro could find footing, particularly with Germany’s freshly approved budget plan set to fuel economic sentiment in the Eurozone. Better fiscal prospects in Europe could provide a supportive environment for the EUR/USD pair to move higher if global risk appetite also improves. Conversely, if the Fed hints at a more aggressive policy—i.e., the likelihood of rate hikes or a less aggressive sequence of easing—then the U.S. Dollar will likely pick up even more steam. This will potentially put downward pressure on the Euro, sending EUR/USD lower over the short run. Also, if future Eurozone data does not indicate a robust recovery in spite of Germany’s budget stimulus, market faith in the Euro will further deteriorate, exacerbating the downside risk.

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