Created on March 17, 2025

• The US dollar has rallied a bit during the early hours on Friday but you can see we continue to struggle near the 149 yen level.
• This is an area that previously was significant support so I think at this point in time we are trying to determine whether or not the US dollar is going to completely collapse against the Japanese yen or if we can form some type of bottom.

Looking at the weekly candlestick, I can see that it is a bit of a hammer and I’m seeing that across the board with the US dollar against most of its major currency competitors. next week could be interesting for the greenback. In this particular currency pair, I would need to see a daily close above 150 yen to get particularly interested in buying, but it is worth noting that the interest rate differential does favor the United States.

Risk Appetite?

Furthermore, if there’s a little bit more of a risk on feel, then you could make the argument for this pair of rallying as well. Keep in mind that the Japanese yen tends to move in the same direction against most currencies. So, if this one rises, you might be able to find more juice with the British pound against the Japanese yen, or even the New Zealand dollar against the Japanese yen as an example. On the other hand, if we do fall from here, we could very well plunge towards the 145 yen level, which is

All things being equal, the next major support level underneath. I do think that you have a situation where traders are a little hesitant to get overly exposed one way or the other. So, I would like to see a little bit of follow through in one direction or the other in order to get a sizable position right now. think volatility is the one thing you can probably count on in a very choppy tight range.

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Created on March 17, 2025

• EUR/USD bulls have recently attempted to maintain movement around and above the 1.0900 resistance to ensure an upward trend reversal.
• However, the upward rebound gains for the EUR/USD pair stopped around the 1.0947 resistance level, the highest for the pair in five months.
• The currency pair will start trading the new important week stable around the 1.0875 level, as Forex investors continue to monitor the reaction to the US Federal Reserve’s announcement this week, the tone of the bank’s policy statement, and the statements of its governor, Jerome Powell, amidst global political and trade shifts that threaten the future of economic recovery and the new US administration’s desire for lower interest rates.

German Stimulus Supports Euro Gains

According to recent forex market trading, the euro rose against other major currencies in general, thanks to news of the German Green Party’s approval of Merz’s plans. German politicians had overcome a major hurdle by approving an unprecedented spending package proposed by new German Chancellor Friedrich Merz as part of a spending revolution. Overall, the Green Party’s approval means a solid majority in the Bundestag to pass the constitutional amendments needed to boost borrowing for infrastructure and defence investment.

The German stimulus plan aims to allocate approximately 2% of GDP annually to infrastructure and defence spending over the next ten years. As a result, according to licensed trading platforms, the EUR/USD pair jumped back above the 1.09 resistance level, and German 10-year bond yields rose 5 basis points to 2.93.

For his part, German Chancellor Merz agreed to allocate approximately 10% of the €500 billion infrastructure spending package to environmental and climate investments, in an effort to win the support of his junior coalition partner. The euro’s performance was clearly sensitive to concerns about stalled negotiations. Overall, the constitutional amendment legislation must be passed in the current Bundestag, where the CDU/CSU, the SPD, and the Greens hold the required two-thirds majority. Economists believe these plans will allow Germany to invest up to €1 trillion over the next decade, providing a much-needed boost to Europe’s largest economy. They believe this will help lift all restrictions on economic activity. However, this type of spending takes time to plan and implement, meaning it won’t be effective until 2026.

Trading Tips:

Be cautious, EUR/USD gains, unless they gain new positive momentum, may be subject to profit-taking selloffs, and be cautious of the important events of this week.

EUR/USD Forecasts for the Coming Days

In this regard, according to Forex market experts, DNB Markets raised its short-term Euro forecasts, citing a change in investor sentiment and increased optimism about the prospects of the European economy. However, the improved forecast target remains below the current level, reflecting the continued “optimistic” stance towards the US dollar. This upgrade is necessary to reflect the sharp rise in the Euro’s value, which saw its biggest rise since 2009. This rise is due to renewed confidence in European growth and the fading of US economic exceptionalism. DNB market experts added in a special note: “The news last week about a German ‘whatever it takes’ fiscal approach to infrastructure and defense has turned sentiment from pessimism to optimism.” However, the bank remains optimistic about the US dollar in the long term, maintaining its 12-month EUR/USD forecast at 1.06, and warning that recent US economic concerns may be exaggerated.

The bank now expects EUR/USD to reach 1.04 in three months, up from a previous forecast of 1.00. EUR/USD may break the 1.12 level – prepare! Morgan Stanley raises its targets, indicating a major shift in currency dynamics.

For its part, DNB Markets dismissed recent US economic growth concerns as overblown and continues to expect the Federal Reserve to raise interest rates in December, contrary to market expectations of a rate cut. While acknowledging the global uncertainty, the bank predicted the US dollar would regain strength as markets adjust to improved US economic fundamentals.

However, the Danish National Bank also highlighted a potential long-term shift in global capital flows, as investors reassess risks associated with US trade policies and international relations. The Danish National Bank warned that “if we are on the cusp of a structural shift in global savings, we are opening the door to a significant repricing of the US dollar beyond what we have already experienced.”

Despite this uncertainty, the bank emphasizes the strength of US economic fundamentals and believes that near-term market pricing is overreacting to geopolitical risks.

EUR/USD Technical Analysis Today:

Based on recent trading on the daily chart above, the EUR/USD pair is still on an upward trajectory. Moreover, bulls may need to move towards the psychological resistance of 1.1000 to confirm control of the trend. Simultaneously, this peak will move technical indicators towards strong overbought levels. At the same time, and over the same timeframe, a move towards the support level of 1.0760 will be important for bears in the event of a breakout of the current ascending channel.

We expect the EUR/USD pair to remain within narrow ranges around its current trajectory until financial markets and investors react to the US Federal Reserve’s announcement, the Governor’s remarks, and a package of important US economic releases, in addition to the trajectory of Trump’s trade and political policies.

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Intraday Trading:

Gold is currently trading within a narrow range of sideways movements at intraday levels.

It is aiming to build positive momentum that could help it surpass the psychological barrier at $3,000, a level it touched during last Friday’s session.

The price also managed to shake off the bullish exhaustion, as indicated by the RSI signals.

Next Price Target:

The next target is set at $3,055, according to the short-term symmetrical triangle pattern.

This target comes amid strong control by the primary uptrend and price trading in line with the trendline.

Positive Scenario:

The bullish scenario hinges on the price remaining above the support level at $2,950.

A break below this level could trigger downward pressure and potentially initiate a corrective wave that may take some time to unfold.

• GBP/USD trades in a narrow channel above 1.2900 on Monday.
• The Fed and the BoE will announce monetary policy decisions later this week.
• The pair clings to a slightly bullish bias in the near term.

Although GBP/USD registered modest losses on Thursday and Friday, the pair managed to end the previous week in positive territory. Early Monday, the pair moves sideways at around 1.2950.

During the European trading hours, US stock index futures lose about 0.5% on the day, pointing to a cautious market stance. Nevertheless, GBP/USD’s downside remains supported for now, with investors refraining from taking large positions in anticipation of this week’s key macroeconomic events.

On Wednesday, the Federal Reserve (Fed) will release the interest rate decision and publish the revised Summary of Economic Projections (SEP), the so-called dot plot. On Thursday, the Bank of England (BoE) is expected to maintain its monetary policy settings following the March meeting.

Ahead of the Fed and the BoE announcements, the US economic calendar will feature Retail Sales data for February on Monday. Investors expect Retail Sales to grow by 0.7% on a monthly basis, following the 0.9% contraction reported in January. A big negative surprise in this data could weigh on the USD with the immediate reaction and help GBP/USD edge higher. A bearish action in Wall Street, however, could support the USD later in the day and make it difficult for the pair to gather bullish momentum.

GBP/USD Technical Analysis

GBP/USD remains within the upper half of the ascending regression channel and the Relative Strength Index (RSI) indicator on the 4-hour chart holds slightly above 50, reflecting a lack of seller interest.

On the downside, 1.2920 (50-period Simple Moving Average (SMA), mid-point of the ascending channel) aligns as immediate support before 1.2870 (static level) and 1.2790-1.2780 (100-period SMA, lower limit of the ascending channel).

Looking north, resistance could be spotted at 1.2970 (static level), 1.3000 (static level, round level) and 1.3060 (upper limit of the ascending channel).

• The EUR/USD forecast shows a strong euro amid optimism over Germany’s fiscal plans.

• German parties agreed to change the government’s borrowing limits.

• Data on Friday revealed a sharp drop in US consumer confidence.

The EUR/USD forecast shows optimism over Germany’s fiscal plans, likely boosting the Eurozone economy. As a result, the euro has held near its recent five-month peak. On the other hand, the dollar remains subdued amid fears of a US recession due to Trump’s trade policies. 

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On Friday, reports revealed that German parties had agreed to change the government’s borrowing limits. Therefore, the 500 billion euro fund proposal might come to life, boosting defense and infrastructure. This, in turn, will support the Eurozone economy and strengthen the euro. 

Meanwhile, the dollar remained weak due to fears of the US recession and downbeat economic data. Trump’s aggressive trade policy changes have raised fears of a sharp slowdown in the US economy. Trump’s tariffs have ignited trade wars that will likely reduce trade in the global economy. Moreover, experts believe these duties will increase inflation, forcing central banks to keep interest rates elevated. 

Therefore, policymakers will likely remain cautious despite soft inflation numbers. Notably, data on Friday revealed a sharp drop in consumer confidence. The lack of confidence in the economy proves investors are worried about the impact of Trump’s tariffs. At the same time, inflation expectations jumped.

EUR/USD key events today

• US core retail sales m/m
• US retail sales m/m

EUR/USD technical forecast: Bulls battle to keep control at the 30-SMA

On the technical side, the EUR/USD price has recovered to retest the 1.0901 resistance level. As a result, it has broken back above the 30-SMA, showing bulls are struggling to keep control. At the same time, the RSI trades above 50, suggesting strong bullish momentum.

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Previously, the RSI had made a bearish divergence that signaled a likely reversal. This allowed bears to return and push the price below the 30-SMA. However, they have failed to make a significant swing below the SMA. If bulls regain momentum, the price will break above 1.0901 to seek new highs. This would allow EUR/USD to go beyond the 1.1001 key psychological level. 

On the other hand, if bears are ready to take charge, the price will stay below 1.0901. Moreover, it might drop to retest the 1.0701 key level.

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