ATFX Market Outlook 6th March 2025
ATFX Market Outlook 6th March 2025
Wall Street Jumps on Trump’s Auto Tariff Delay
[Markets highlight]
In overnight news, US ADP private employment increased by only 77,000 in February, signaling a slowdown in growth. The US ISM Services PMI rose to 53.5 from 52.8, while the Federal Reserve's Beige Book noted a slight upturn in economic activity, though concerns about tariffs are growing. President Trump announced a one-month exemption from 25% tariffs on automakers from Canada and Mexico, boosting Wall Street, with the Dow up 1.14%, S&P 500 up 1.12%, and Nasdaq up 1.46%. The US dollar index fell 1.2% to 104.29, and the euro reached a high of 1.0791. Gold prices remained stable at $2,918.84, while oil prices declined for a fourth session due to rising US crude inventories and OPEC+ production concerns.
The European Central Bank will announce its interest rate decision this evening, likely opting to cut rates by 25 basis points. However, some ECB officials suggest a shift towards "caution," which could indicate a slowdown in the trajectory of rate cuts, as discussed in President Lagarde's monetary policy press conference. Most investors are pausing to await tomorrow's US job report, conscious of the market correction anticipated ahead of the report's release.
[Financial data and events of significant concern]
18:00 EU Retail Sales JAN **
18:00 EU Leaders Summit **
21:15 ECB Interest Rate Decision ***
21:30 US Initial Jobless Claims ***
21:45 ECB Press Conference ***
Tomorrow
21:30 US Non Farm Payrolls FEB ***
21:30 CA Unemployment Rate FEB **
EURUSD
1.0857/1.0894 Resistance
1.0695/1.0658 Support
EUR/USD rose 1.75% on Wednesday, nearing 1.0800, driven by improved risk sentiment from President Trump's tariff shift. February's ADP Employment Change was only 77,000 jobs, below expectations, and the pair gained 185 pips, exceeding the 200-day EMA at 1.0640. Despite a 4% rise over three days, indicators suggest a possible pullback to the 200-day EMA before a new bullish trend. The ECB may lower rates by 25 basis points, so traders should watch the ECB Press Conference for guidance on future rate changes and the Euro's direction.
GBPUSD
1.2930/1.2986 Resistance
1.2817/1.2762 Support
Bank of England Governor Bailey called on the US to withdraw from the trade war and supported cautious interest rate cuts, which benefitted the pound. The pound has strengthened against the US dollar and non-US currencies for three days, reaching a four-month high and testing above 1.2900. It aims to break through this level today. However, traders should consider that tomorrow's US job report may limit further gains.
USDJPY
149.60/149.92 Resistance
148.55/148.23 Support
The USD/JPY resumed its downward trend, closing at a new low since early October. Following rejection above the 10-day moving average around 149.50, it may test the recent low near 148, with a current focus on support levels at 148.55/148.23.
US Crude Oil Futures (APR)
67.25/67.88 Resistance
65.82/65.20 Support
Trump's trade war has adversely affected crude oil demand, while OPEC+'s decision to boost supply has resulted in four consecutive days of falling international oil prices, now around $65. It remains uncertain whether $65.20 can act as a significant support level.
Spot Gold
2938/2956 Resistance
2894/2880 Support
Spot Silver
32.89/33.14 Resistance
32.31/32.05 Support
Despite a weakened US dollar, spot gold fluctuated, dropping below $2,900 before recovering to $2,930. Late trading showed little change, with $2,930 acting as resistance. Investors should consider gold's momentum before tomorrow's US non-farm data release. The upward trend will be maintained if it stays above $2,910, where key moving averages intersect.
Dow Futures
43575/43809 Resistance
42580/42281 Support
Wall Street's major indices closed higher amid volatility on Wednesday as U.S. trade tensions eased. After two days of decline, the Dow Futures rebounded, approaching the 10-day moving average near 43,390. However, any upward momentum may be limited before tomorrow's release of the US Job report.
NAS100
20985/21183 Resistance
20343/20141 Support
Large technology stocks rose overnight, with Microsoft leading with a 3.19% gain and most large-cap tech stocks climbing to over 2%. Nasdaq experienced its first rebound this week but encountered resistance at the previous day's high of 20688. Should this trend continue, it will remain within a downward channel.
BTC
93204/95171 Resistance
86718/84732 Support
After recent volatility, Bitcoin (BTC) dropped to a low of $81,500 but has since recovered. While it tested this lower boundary, it has not reached the mid-level curve, which currently sits at $92,200. Considering recent trends, BTC, trading below $92,200, is expected to face resistance at this level. If BTC breaks through, it could surpass the mid-level curve and potentially aim for $93K to $95K, a Fibonacci retracement barrier.
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