GBPUSD: the pair is holding above the 1.1950 threshold
GBPUSD has crossed the resistance threshold at 1.1950, intending to continue its success supported by macroeconomic statistics and market forecasts of the Bank of England keeping the hawkish rate at the end of the meeting announced on March 23 because the officials are confident that inflation will go down to 3.5% by the end of 2023 and to 1.0% in 2024.
According to Tuesday's publication by the Royal Institute of Purchasing and Supply, business activity in the manufacturing sector was 49," points, beating expectations of 47.5 points and above the previous 47.0 points, and the services sector reached 53.3 points, beating analysts' forecast of 49.2 points and better than the previous 48.7 points. The composite indicator was 53.0 points above market expectations of 49.0 points and above its previous reading of 48.5 points. The composite indicator of private sector manufacturing capacity rose to 53.0 points for February from the previous reading of 48.5 points, well above the forecast of 49.0 points. Investors note the positive dynamics of British companies after six months of recession, which strongly reduces the probability of recession in the national economy.
- Resistance levels: 1.2450, 1.2650, 1.2990.
- Support levels: 1.1950, 1.1550.
AUDUSD: the Australian currency is moving in correction
The AUDUSD currency pair is trading moderately higher as part of the correction, ending a two-day decline when the instrument updated its local low of January 6. Technical factors set the positive dynamics, which was only strengthened by the massive closing of the long-term U.S. dollar contracts on the release of February minutes of the Fed meeting, where investors noted the significant potential of the "hawks" rhetoric, which will lead to a prolonged holding of the key value at high levels. Market participants agree that the ceiling value is considered by the regulator at the level of 5.00%.
The Australian currency came under the pressure because of the publication of weak macroeconomic statistics. Thus, the level of construction objects commissioned in Australia in Q4 2022 decreased by 0.4% against the previous growth of 2.2% while analysts estimated growth of 1.5%. Meanwhile, statistics on wage fluctuations in the same period showed a decline to 0.8% from 1.0% for the quarter, and an increase to 3.3% from 3.1% for the year with a forecast of 3.5%. The positive trend has peaked over the past ten years, reinforcing concerns among market participants who are allowing an inflationary spiral to form in the national economy.
- Resistance levels: 0.6850, 0.6900, 0.6950 and 0.7000.
- Support levels: 0.6800, 0.6750, 0.6700, 0.6650.
Silver analysis
Having shown active decline earlier when the instrument updated the local lows of February 17, silver has started a recovery in Asian trading, being at 21.60.
The trading instrument remains under enough pressure because of forecasts of tighter monetary parameters by the European Central Bank. The day before, the head of the agency Christine Lagarde made a statement about the necessity to keep the hawks' course within the framework of the consumer prices of the region returning to the target of 2.0%. According to her opinion, the situation on the battlefield in the war unleashed by Russia against Ukraine poses a threat to the economy, because the cost of energy and food can return to growth. Analyzing the situation, economists are mostly confident that the March correction of the index will be 0.50%.
- Resistance levels: 21.75, 22.00, 22.21, 22.50.
- Support levels: 21.39, 21.14, 20.83, 20.55.
Oil Market analysis
The U.S. regulator's minutes for February which were released the day before put heavy pressure on WTI oil quotes, which are already correcting at 74.33 today.
Meanwhile, Bloomberg reported that Russia continues to increase its exports of hydrocarbons and fuel oil to China, which reached a peak of 1.66m barrels per day in April 2020, while its crude oil and condensate shipments strengthened to 1.52m barrels per day. China's growing economy is driving the positive trend amid the cancellation of epidemic measures and an ultra-flexible discount move by the Russian authorities. However, the level of Urals discount to benchmark Brent should decrease, which will be caused by the adjustment of the national legislation on the part of the tax burden on production and production of minerals and minerals and payments for added value, as well as reverse excise duties on oil. Thus, the expected rebate in the April-July period will undergo a phase-in correction from 34.00 to 25.00.
- Resistance levels: 75.00, 76.00, 77.00, 78.00.
- Support levels: 74.00, 72.45, 71.00, 70.00.