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The greenback once again suffered disheartening prints from US fundamentals, although speculation for a rate cut by the Fed in June appears firm. On another note, Gold climbed to record highs as well as Bitcoin.

Here is what you need to know on Wednesday, March 6:

The greenback retreated for yet another session and kept the price action around the USD Index (DXY) depressed well below the 104.00 level. On March 6, all the attention will be on Chair Powell’s first testimony, followed by the ADP report.

EUR/USD maintained the bullish bias in place and rose to two-week highs near 1.0880. In the domestic calendar, the Balance of Trade in Germany and Retail Sales in the broader Euroland are due on March 6.

GBP/USD could not sustain an earlier move to multi-week highs near 1.2730, closing the session with marginal gains instead. On March 6, the S&P Global Construction PMI will be the sole release across the Channel.

USD/JPY left behind two consecutive daily advances and broke below the key 150.00 zone. Next on tap in the Japanese docket will be the usual weekly Foreign Bond Investment figures and the speech by BoJ Nakagawa on March 7.

AUD/USD traded on the defensive and added to Monday’s pessimism, briefly revisiting the 0.6480 region. The GDP Growth Rate during the October–December period takes centre stage in Oz on March 6. 

On March 6, the Bank of Canada is expected to keep its policy rate unchanged, seconded by the Ivey PMI and the press conference by Governor T. Macklem. USD/CAD, in the meantime, rose further and trespassed the 1.3600 hurdle, although it gave away some of those gains afterwards.

WTI prices remained on the back foot as news of extra reforms in China and the country’s planned GDP target failed to ignite some optimism among traders.

Gold prices advanced further and printed an all-time high past the $2,140 mark per troy ounce on the back of increasing bets of rate cuts by the Fed. Silver rose to fresh tops north of the $24.00 mark per ounce, although the industrial metal later succumbed to renewed selling impetus.

Outside the FX universe and moving into the political arena, the US Super Tuesday results are expected to be one of the salient events on Wednesday. On Super Tuesday, the highest number of states will host presidential primaries or caucuses, as more than one-third of all delegates available for both the Republican and Democratic nominations will be up for grabs. President J. Biden stands as the frontrunner for the Democratic nomination, facing no significant primary challenge. Meanwhile, former President D. Trump maintains a lead over former Un Ambassador Nikki Haley in the race for the Republican nomination.

Watching for Daily Close Above 2,035

Gold continues to trade below both the 2,131 target and the prior record high at 2,135. Therefore, it could easily close below those price levels. However, if it can close above 2,131 it will be showing greater strength than closing lower. And a close above 2,135 of course is a more bullish indication than a close below 2,135.

Higher Target is 2,189

In the short-term, gold may be extended and due for a retracement or consolidation of a day or a few, if not longer. Once that phase is done, whichever form it takes, gold should be ready to proceed towards the first major higher target zone around 2,189 to 2,194. The current sharp advance in gold began following a breakout of a large symmetrical triangle pattern. An initial target can be calculated from the pattern, and it points to 2,189. The purple arrows mark the related measurements.

Measured Moves Confirm Target

Further, two previous measured moves are highlighted in blue on the chart. They show impulse rallies coming up off the October swing low. The first rally is 11% and the second 10.5%. If the lower 10.5% advance occurs in the current advance, gold would be hitting approximately 2,094. The measure starts from the most recent swing low at 1,984 (C).

Highest Daily Closing Price Historically

Yesterday’s closing price of 2,114 was the highest daily closing price ever for gold, and today will likely end with a new record closing price. Gold has been setting up for large move into new record highs ever since reaching a high of 1,921 in 2,011. A multi-year basing pattern followed in the shape of a cup with handle. If this week’s advance is sustained and the price of gold further strengthens, gold will be rising out of a new floor in price.

For a look at all of today’s economic events, check out our economic calendar.

The economy’s medium-run growth potential remains tepid around 1% despite continued progress on reforms through the “Greece 2.0” and Greek Recovery and Resilience plans. Constraints include adverse demographics, as well as weak and uneven productivity growth across the regions because of years of public- and private-sector under-investment and a lack of business-sector dynamism.

Political Stability And Policy Continuity Crucial To Sustaining Investor Confidence

The recent out-performance of the Greek economy gives us confidence that robust economic growth is not transitory, but there are nevertheless several challenges for the outlook. Persistent uncertainty over the inflation outlook raises questions of whether inflation will continue to decline towards the ECB 2% objective. Core inflation sits well above 2% despite recent significant disinflation.

We see inflation remaining above the ECB objective for much of this year. Furthermore, we cannot exclude new supply-side crises in view of a turbulent international political and economic context, which might again send inflation higher later and further postpone the fuller normalisation of monetary policies.

Environmental challenges are also relevant. Among the EU, Greece is most exposed to rising temperatures and more frequent heatwaves and wildfires, which can damage the crucial tourism and agriculture sectors.

Finally, new political challenges could emerge following general elections due by 2027 if the government shifts away from current business-friendly policies. Maintaining a constructive dialogue with European institutions and the capital markets is relevant, as is avoiding the temptation of further reversing the difficult reforms introduced during the debt crisis.

Regaining investment-grade status has contributed to the narrowing of yield spreads on 10-year Greek government bonds – to under 100bp to Germany recently – reflecting significantly better investor confidence.

Further progress on reforms to strengthen the structure of the economy and enhance macroeconomic sustainability would contribute to improving Greece’s appeal for foreign and domestic investors. Moreover, the presumed peak in the ECB rate-hike cycle ought to facilitate investment.

For a look at all of today’s economic events, check out our economic calendar.

Dennis Shen is Senior Director in Sovereign and Public Sector ratings at Scope Ratings GmbH, and lead analyst on Greece. Alessandra Poli, Analyst at Scope, and Matthew Curtin, Deputy Head of Communications of Scope, contributed to writing this article.

Bitcoin is showcasing a robust trend that indicates a potential trajectory toward the $70,000 mark. The current price action reflects strong bullish sentiment, and if the momentum is sustained, Bitcoin could very well be on its way to setting a new all-time high.

A technical analysis of Bitcoin’s chart reveals that it has been consistently forming higher highs and higher lows — a classic indicator of a bullish trend. The moving averages are aligned in a way that supports continued growth, with the short-term averages above the longer-term ones, suggesting that the immediate trend is upward.

The key support levels have been established at $54,683 and $48,151, which have provided a solid foundation during the recent climb. As long as these levels hold, the path toward $70,000 remains open. 

However, it is notable that the buying power is showing signs of fatigue, as indicated by the decreasing volume on the recent uptrend. This divergence between price and volume could suggest that a consolidation or minor pullback might occur before any further significant upward movement.

Despite the fading buying power, there is a possibility of a supply shock on the Bitcoin market. A supply shock occurs when there is a sudden decrease in the available supply of Bitcoin, often due to hoarding by long-term holders or institutional acquisitions. Such a reduction in liquidity can lead to a rapid price increase as demand outstrips supply.

Shiba Inu explodes

Shiba Inu continues to display a bullish performance that keeps market woes at bay. The token appears to be gearing up for another rally, potentially pushing it to new heights.

The price analysis of SHIB shows a clear uptrend, with the asset breaking past several resistance levels in recent months. The token has been making consistent gains, drawing in both retail and speculative investors attracted by its volatile yet lucrative market movements. Support levels have risen correspondingly, with the token finding new floors at higher price ranges after each spike.

The current trend for SHIB is positive, with the token showing resilience and maintaining its gains despite broader market fluctuations. The immediate resistance to watch is at the recent high; if SHIB breaks through, there could be little stopping it from achieving new record levels.

In a bearish scenario, a sudden shift in investor sentiment or broader market dynamics could trigger a sell-off, leading to a sharp correction. The meme coin space is crowded with new entrants seeking to replicate SHIB’s success, and the competition could dilute interest and impact the price negatively.

XRP on the edge

XRP has recently approached a significant resistance level at $0.64, a price point that has historically acted as a major breakpoint for the asset. This level is critical for XRP’s continued upward movement, and breaking through could signal a new bullish phase for the cryptocurrency.

Currently, XRP is trading in a range where the moving averages are starting to realign in a way that might indicate an upcoming golden cross — a technical chart pattern where a shorter-term moving average crosses above a longer-term moving average, typically suggesting a potential bull market on the horizon.

In the bullish scenario, the golden cross would materialize, and with a strong volume breakout above the $0.64 resistance, XRP could enter a new uptrend, targeting previous highs. This could potentially attract more investors, both retail and institutional, leading to a substantial price increase.

However, there is also the bearish possibility to consider. If XRP fails to break the $0.64 level, it may result in a price rejection that could see it retreating back to lower support levels. These levels, around $0.55 and $0.52, could serve as consolidation points before another attempt at resistance. A drop below these support levels might indicate a more prolonged bearish trend, potentially undoing recent gains.

The UK’s financial regulatory authority has announced plans to examine if small enterprises are encountering undue obstacles to expansion due to increasing banks requiring personal loan guarantees.

The Financial Conduct Authority (FCA) revealed on Tuesday that the Federation of Small Businesses (FSB), acting as a consumer advocacy group, has raised concerns about the negative impact on small businesses caused by lenders’ heightened demands for personal guarantees, potentially deterring them from seeking financial support.

Although the FCA’s mandate does not extend to lending practices for limited companies, it has committed to facilitating the growth of small businesses by identifying and eliminating any unnecessary barriers. The specific steps to be taken were not elaborated upon.

Highlighting the significant role of small and medium-sized enterprises in the UK economy, the FSB has reported that these businesses are responsible for 60% of employment and about half of the revenue within the private sector as of 2023.

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Particularly, small firms, defined as those with less than 50 workers, had employed 13.1 million individuals last year, generating a total revenue of 1.6 trillion pounds ($2.03 trillion).

To assess the prevalence of personal guarantees, the FCA plans to gather data from April to June 2024, focusing on loans below 25,000 pounds ($31,713) provided to sole traders and small partnerships.

This investigation will include monitoring complaints and reviewing the circumstances under which such guarantees are mandated. Furthermore, based on their findings, the FCA will evaluate the need for consultation and the issuance of guidance.

In instances where issues identified are beyond its regulatory scope, the FCA intends to disclose these findings publicly. This transparency prompts governmental consideration of whether small businesses, deemed crucial to the UK’s economic fabric, require additional protections.