Forex trading plan for March 4, 2015
EUR/USD tried it best to hold above the 1.1200 level, but failed. The pair is slowly heading the January low of 1.1097 – break below this point would open a direct way to parity. Euro zone released moderately positive data at the beginning of the week, but the overall forecast remains bearish. Watch the Services PMI indices on Wednesday.
On Thursday the market will focus on the ECB policy meeting that will be followed by the Draghi’s press conference. Traders expect for the details of the 1-trillion-euro ECB’s QE program that will be begin in mid-March.
Net long USD positions have been growing since the beginning of the week. In our outlook, the ECB meeting could become a fine “excuse” for the market to push with a new dollar rally. US employment and wages reports on Friday could cause to be further support for the American currency.
In the meantime, GBP/USD fell towards the 1.5350 level following the last week’s push to 1.5550, The BOE meeting on Thursday will probably be a non-event. Observe UK inflationary expectations on Friday the figures could weigh on the sterling.
AUD/USD climbed to 0.7840 as the RBA left rates unchanged at 2.25%, but we see escalation limited. Markets will be waiting for a rate cut on the next meeting. The expectations will force the Aussie in the next weeks. Australia is planned to release Q4 GDP on Wednesday (forecast: +0.7%, Q3: +0.3%). You should also watch Chinese Service sector HSBC PMI on Wednesday. Although the data are positive, we recommend selling AUD/USD from 0.7900/15.