EURO AND STOCKS RISE AS UKRAINE/RUSSIA TALKS BEGIN
European stocks and American futures tilted upwards on Tuesday as investors watched the new developments on Ukraine. Teams from Russia and Ukraine started fresh talks in Turkey as they attempted to solve some of the challenging issues. Before the meeting, Ukraine’s president reiterated that he was open to a deal on neutrality. At the same time, Russia has continued shelling Ukraine’s cities and destroyed buildings and roads worth billions of dollars. It has also announced that it will shift its focus to the eastern side of the country after it struggled to capture Kyiv. The FTSE 100 and DAX rose by more than 1% while futures tied to the Dow Jones and Nasdaq 100 rose by over 30 basis points.
The price of crude oil moved sideways as investors focused on the talks in Ukraine and the lockdowns in China. Shanghai reported over 4,381 new symptomatic Covid-19 cases as the government announced a lockdown. Highways, businesses, and other institutions have been closed and people ordered to stay indoors. Therefore, while supply concerns remain, there are hopes that these lockdowns will help slow demand since China is the biggest consumer of oil. The next key mover for oil prices will be the upcoming inventories data by the American Petroleum Institute (API).
There were several important numbers released today. In the morning session, data by Japan’s statistics agency said that the unemployment rate dropped from 2.8% to 2.7%. This decline was better than the median estimate of 2.8%. The jobs to applications ratio rose to 1.21. Meanwhile, in Australia, preliminary data revealed that retail sales rose by 1.8% in February. The EURUSD pair rose even after the disappointing data from Germany. The consumer climate declined to 15.5 as inflation concerns remained. Consumer confidence also dropped to 91 in France.
EURUSD
The EURUSD pair has been in a consolidation mode in the past few days. This changed today as talks between Russia and Ukraine continued. It rose to a high of 1.1052, which was the highest level since March 20th. On the four-hour chart, it is slightly below the 38.2% Fibonacci retracement level. It also moved above the 25-day and 50-day moving averages. The Relative Strength Index has also tilted upwards. Therefore, the pair will likely keep rising as investors target the 50% retracement level.
XAUUSD
The XAUUSD pair declined to a low of 1,913, which was the lowest level since March 16th. On the four-hour chart, the pair managed to cross the 25-day and 50-day moving averages while the Relative Strength Index is approaching the oversold level. The commodity channel index has also moved below the oversold point. The pair will likely keep falling during the American session.
ETHUSD
The ETHUSD pair continued its bullish trend as investors waited for the upcoming merge. It rose to a high of 3,435, which was the highest point since February. The pair is above the ascending trendline shown in brown while the MACD is above the neutral level. The Relative Strength Index has also kept rising. Therefore, the pair will likely keep rising in the near term.
