Midweek Market Overview: USD Rallies Before FOMC Meeting Minutes

<WikiFX Malaysia Original: Editor – Fion>

The US Dollar:

In Mondays article https://www.wikifx.com/en/newsdetail/202203302654517267.html), we highlighted that the US Dollar was hovering right below the 99.00 area, and explained that it was possible to challenge its resistance zone again.

Then, it happened - right before the FOMC Meeting Minutes on 7th April at UTC +8 2.00 am.

At the time of writing, the US Dollar is trading above the 99.500 range. If the previous resistance could now serve as the new support, the next key level that the Dollar could be heading towards is the 100.00 psychological resistance.

The upcoming Fed meeting minutes announcement is expected to reveal the details in relation to its balance sheet reduction plans. Naturally, the US Dollar could also welcome some level of volatility during this release.

Gold:

On the daily chart, gold is still moving in a sideways motion without a clear sense of direction.

Dropping down to a lower time frame, yesterday, gold had a big movement of nearly 300 pips. It rallied up to 1945 but failed to conquer 1950, and then quickly dropped to the 1916 level followed by big bearish candles.

For the time being, it seems like gold has found its support within its consolidation phase as shown on the daily chart above.

While the overall direction is still unknown, gold traders could take intraday trades with its daily fluctuation because it is more volatile than currency pairs.

GBP/JPY:

The GBP/JPY tested its support around the 159.00 area and has continued to move upwards once again.

The Japanese Yen continues to display weakness as the Bank of Japan (BoJ) holds firmly onto its dovish view (previously mentioned here: https://www.wikifx.com/en/newsdetail/202203282494383016.html).

Zooming out to the fortnightly chart of GBP/JPY, it is likely that this pair is heading towards the 164.500 area that was tested several days ago. A breakout above this strong resistance which was last seen in 2016 could potentially bring GBP towards the 170.000 level.

EUR/USD:

The EUR/USD formed a fake breakout around 1.11400 in the last 2 days of March. Since the start of April, it has been dropping bearishly and could head towards the 1.08000 support level.

In our article here https://www.wikifx.com/en/newsdetail/202203233834339738.html, we provided a guide that hopefully had helped the EUR/USD traders and/or investors. We highlighted the need to wait for a retest to avoid being caught in a fake breakout situation.

AUD/USD:

The AUD/USD has also broken above its key resistance zone of 0.75 – 0.75500.

It had a strong bullish momentum up to the 0.76600 level before dramatically retracing back to the 0.75500 area.

For the time being, this old resistance zone of 0.75 – 0.75500 will be a crucial area to pay attention to. Failing to stay above this area could send AUD/USD south whereas sustaining above could potentially bring AUD/USD back to the 0.76600 level or higher in the near future.

<WikiFX Malaysia Original: Editor – Fion>