Anticipation is mounting as investors gear up for today’s much-awaited release of the Personal Consumption Expenditures (PCE) Price Index Report on March 29, 2024. This report, a crucial indicator of inflation, plays a significant role in shaping market sentiments and influencing trading decisions across the globe.
The PCE price index, closely observed by traders and analysts alike, provides insights into the changes in prices of goods and services purchased by consumers. With forecasts and expectations swirling around the US Core PCE Price Index Year-on-Year figures, set against the backdrop of economic indicators and Federal Reserve policies, the trading community is on the edge of their seats.
As the Forex market braces for potential shifts in response to the impending data release, investors remain vigilant, ready to analyze and interpret the implications of the PCE price index report on currency movements and market dynamics.
EUR/USD Intraday: The Downside Prevails Ahead of PCE Price Index Report
In the flurry of the forex market, the EUR/USD pair exhibits a bearish stance as long as 1.0799 serves as resistance, predicting a decline of 20-30 pips. With a pivot set at the 1.0799 mark, traders are advised to consider a SELL position, targeting levels at 1.0770 and 1.0762 for taking profits.
EUR/USD Daily Chart
The RSI residing below its neutrality zone at 50 and a MACD coursing beneath its signal line reflect negative sentiment, further supporting the bearish outlook. Ensuring risk management, the recommendation comes with a risk cap of 2% per intraday trade.
PCE Inflation Report Awaits
Traders brace for the release of the US core Personal Consumption Expenditures (PCE) Price Index—the Federal Reserve’s preferred measure of inflation—scheduled to make its appearance this Friday at 12:30 GMT. Analysts forecast a monthly increment of 0.3% for February, noting a deceleration from the 0.4% surge in January. The annual core PCE is projected to maintain a growth rate of 2.8%.
Given the Federal Reserve’s updated economic projections, the annual core PCE inflation expectations have been nudged up to 2.6% by the end of 2024, reflecting a modest increase from 2.4% in the December forecast. Chairman Jerome Powell has accentuated the necessity for assured deflation toward the 2% target before contemplating policy rate deductions.
Oscar Munoz of TD Securities expresses anticipation for another robust core PCE metric, albeit expecting a reduction from the previous month’s data and the core CPI’s February movement.
USD/JPY Intraday: An Ascending Trajectory
The USD/JPY pair epitomizes calm, orbiting around the 151.40 level during the European early hours. Japan’s March Tokyo Consumer Price Index showcased a year-over-year ascent, with the Core CPI modestly retreating from the past month’s values.
Finance Minister Shunichi Suzuki underscores the imperative of stable currency movements and remains vigilant against erratic FX swings influenced by speculative activities, stating preparedness for corrective measures.
Ascending outlook for the USD/JPY is recommended as long as there’s support at 151.06, with the potential to climb by 50-80 pips. Suggested entry points for BUY positions pivot at 151.06, targeting profits at take-profit echelons of 152.91 and 151.91. The favorable stance is corroborated by the price positioning well above the 20 and 50-period moving averages.
USD/JPY Daily Chart
GBP/USD Intraday: Mounting Pressure Below 1.2642
The GBP/USD currency duo experiences a sideways motion, anchored near 1.2622 amidst the anticipation-laden ambiance of the upcoming US Core PCE Price Index reveal. The UK economic landscape reveals signs of recession, with fourth-quarter GDP conforming to prior assessments at a 0.3% QoQ reduction.
Amidst expectations of a downward rate trajectory from the Bank of England, the GBP faces selling pressure. Initiate SELL orders for GBP/USD beneath a pivot point of 1.2642, forecasting a slip of 30-45 pips with an eye on take-profit markers set at 1.2592 and 1.2578. The analytical condition for further downside anticipation resides in the MACD breaching the zero threshold.
GBP/USD Daily Chart
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