USDJPY
The USDJPY pair continued its downward trajectory for the third consecutive day on Wednesday, inching closer to its lowest level since November 2023. The dovish tone struck by the Bank of Japan (BoJ) at the conclusion of its March policy meeting has exerted downward pressure on the Japanese Yen. Despite the BoJ's decision to raise interest rates for the first time since 2007, investors remained cautious as the central bank refrained from providing clear guidance on future policy steps or the pace of policy normalization.
Technically, the pair faces resistance at the year-to-date peak and the 152.00 mark. A breakthrough beyond these levels could trigger further bullish momentum, indicating a potential uptrend continuation. On the downside, any corrective declines are likely to be viewed as buying opportunities, with support expected near the 151.00 mark.
WTI
Oil prices experienced a decline in Asian trading on Wednesday following the release of industry data revealing an unexpected build in U.S. inventories. This surprising development challenged the prevailing notion of tighter markets in the near term, leading to downward pressure on crude prices. Additionally, the strength of the U.S. dollar, coupled with anticipation surrounding U.S. inflation and interest rate data, contributed to the decline in crude prices, pushing them further away from the four-month highs reached earlier in March.
Brent oil futures for May delivery dropped 0.8% to $85.55 a barrel, while West Texas Intermediate (WTI) crude futures fell 0.7% to $81.05 a barrel by 21:39 ET (01:39 GMT). The downward movement in oil prices was accentuated by lower trading volumes ahead of the Good Friday holiday.
XAUUSD
XAUUSD prices retreated early Wednesday, trading below the $2,180 level after reversing the previous day's uptick that briefly touched $2,200. The strength of the U.S. Dollar remained a key factor influencing gold's movements, as market sentiment soured and the USD/JPY uptrend regained momentum. Investors are now shifting their focus to a speech by Federal Reserve Governor Waller for further insights into monetary policy direction.
In conclusion, the daily analysis reveals a mixed picture across the markets:
USDJPY: Continues to drift lower amidst dovish sentiments from the Bank of Japan. Technical indicators suggest potential bullish momentum if key resistance levels are breached.
WTI: Faces downward pressure due to unexpected build in U.S. inventories and strength of the U.S. dollar. Lower trading volumes ahead of the holiday contribute to volatility.
XAUUSD: Retreated from recent highs as the U.S. Dollar strengthened. Market sentiment and upcoming speeches by central bank officials are likely to influence gold's direction.
Entry Suggestions:
USDJPY: Consider initiating long positions if the pair breaks above the year-to-date peak and the 152.00 mark, targeting further upside momentum. Look for buying opportunities on corrective declines near the 151.00 support level.
WTI: Exercise caution amid the uncertainty stemming from unexpected inventory builds and the impact of the U.S. Dollar's strength. Await clearer signals or confirmations before considering entry positions.
XAUUSD: Monitor price action closely, particularly in response to speeches by central bank officials. Look for potential buying opportunities if gold finds support near key levels and sentiment improves.
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