FX Midweek Outlook 30 March 2023

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Economic Calendar Updates

It has been a quiet start to the trading week with no major events happening so far. All eyes are on the Core PCE Price Index this Friday, although we doubt that it will have as big of an impact on client sentiment as compared to before the chaos in the banking sector.

Core PCEPI is expected to decrease slightly from 0.6% to 0.4%.



Bullish momentum slowed down yesterday on EURUSD, forming a doji pattern on the daily timeframe. From a technical perspective, 1.0770 could serve as the next support, allowing the pair to bounce and continue its upward trajectory and testing the 1.1000 key level. If that is not the case, the pair is likely to consolidate into Friday’s main event.



There was a sudden shift in investors’ sentiment as the dollar quickly reversed against Yen during yesterday’s trading. This looks to be that the fears in the banking industry have calmed down and the risk-on sentiment is coming back into the picture. 

A 200 pips bounce off the 131 key level could indicate further upside potential, possibly into the 134.500 area but inflation numbers risk is still on the table. 

Long-term traders should also be aware not to get caught up in the event that the price continues to consolidate between 131 and 134.50 after a year-long trending phase.

USDJPY Daily Zoomed Out

As highlighted in the chart above, USDJPY has been trending since the same time last year, and mind you it’s not a take-it-easy trend. USDJPY soared 32.5% over an 8-month period before some healthy reversion. Therefore, would the pair finally take a break and go into ranging mode until the BOJ makes a significant policy change?

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