- March 1, 2021
- Posted by: Analysis Team
- Category: FOREX, Technical Analysis
The Australian dollar rose slightly against the US dollar after relatively weak manufacturing PMI data from China and Australia. Yesterday, a report by the National Statistics Bureau revealed that the manufacturing PMI fell from 51.3 to 50.6 in January while the non-manufacturing PMI fell to 51.4. Caixin also reported that the manufacturing PMI fell from 51.5 to 50.9. This performance was mostly because of the lunar new year where people in China travel to spend time with their families. Meanwhile, in Australia, the AIG manufacturing PMI rose from 55.3 to 58.8 while the Markit PMI fell from 57 to 56.9.
The price of cryptocurrencies continued to decline during the weekend as the sentiment in the market waned. Investors are also getting worried about the rising inflation in the United States after the House of Representatives passed Biden’s $1.9 trillion stimulus package. Analysts believe that this package will lead to higher inflation and interest rates. The price of Bitcoin dropped to below $44,000 for the first time in a few weeks. Similarly, other cryptocurrencies like Ethereum, Ripple, and Litecoin also fell sharply.
The focus in the economic calendar today will be on global manufacturing activities. Markit and its local partners will deliver the final manufacturing PMI of February. Economists expect that numbers from most countries will show that the manufacturing sector continued to do well. In Europe, they expect that the PMI increased from 54.5 to 57.7 while in the United Kingdom, the PMI rose from 54.9 to 55.6. The same theme will probably be seen in the US, which boosted its vaccination process in February.
The EUR/USD pair rose slightly in early trading ahead of the PMI data from around the world. The pair rose to 1.2080 from last week’s low of 1.2061. On the four-hour chart, the price is below the 25-day and 15-day exponential moving averages while the RSI and the MACD are also pointing lower. The pair is also slightly below the Ichimoku cloud. Therefore, the pair remains bearish in the near term as bears target the support at 1.2050.
The GBP/USD pair also rose slightly in the morning session after it dropped sharply on Friday. The pair is trading at 1.3980, which is slightly above Friday’s low of 1.3890. On the four-hour chart, the price is slightly below the short and longer-term moving averages. It is also slightly below the white ascending trendline while the Relative Strength Index (RSI) has also continued to decline. Therefore, the pair may resume the downward trend later today.
After dropping sharply on Friday, the AUD/USD pair rebounded today and is trading at 0.7760, which is slightly above Friday’s low of 0.7692. On the four-hour chart, the price is also slightly below the Ichimoku cloud and the short and longer simple moving averages. There is a high probability that the price will resume the downward trend later today. If it does, bears will attempt to retest Saturday’s low of 0.7692.