USD, EUR, GBP Price Forecast: Navigating Through Services and Manufacturing PMI Data

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Published: Feb 22, 2024, 08:17 GMT+00:00

Key Points:

US Dollar shows a decline of 0.30% to 103.678 amid upcoming PMI data, hinting at a volatile market landscape ahead.
EUR/USD climbs 0.31% to $1.08517, with a bullish trend above the pivot of $1.08208, spotlighting Eurozone's PMI and CPI data.
GBP/USD's rise of 0.29% to $1.26741 reflects cautious optimism, with immediate resistance at $1.26693 and support at $1.25778.

Eyes on Services and Manufacturing PMI Ahead

The US Dollar trading sharply bearish at 103.678, showing a decrease of 0.30%. In the Eurozone, the German 10-year Bond Auction saw yields at 2.38, a slight increase from previous levels, indicating a cautious optimism among investors.

For the British Pound, recent data showed Public Sector Net Borrowing at -17.6 billion, slightly better than expected, and CBI Industrial Order Expectations at -20, suggesting a challenging industrial climate.

Events Ahead

US Dollar Dynamics: The immediate outlook for the US Dollar will be shaped by several critical data releases. Unemployment Claims are forecasted at 217K, hinting at the labor market’s resilience. The Flash Manufacturing PMI is anticipated to slightly increase from 50.5 to 50.7, while the Services PMI is expected to edge up from 52.4 to 52.5. Existing Home Sales are projected to rise from 3.78M to 3.96M, indicating a potential uplift in the housing market.

Eurozone’s Economic Pulse: For the EUR/USD pair, the spotlight turns to the Eurozone’s PMI data. French Flash Manufacturing PMI is expected at 43.5, with Services PMI at 45.7, suggesting a contraction in the sector. German PMI forecasts also depict a challenging scenario, with Manufacturing PMI at 46.1 and Services PMI at 48.0. The broader Eurozone PMI data mirrors this trend, with Manufacturing PMI predicted at 47.0 and Services PMI at 48.8. The Final Core CPI and CPI year-over-year are both forecasted to remain steady at 3.3% and 2.8%, respectively, providing critical insights into the inflationary landscape.

GBP’s Economic Outlook: The GBP/USD pair will closely watch the UK’s economic indicators. Flash Manufacturing PMI is projected at 47.5, slightly improving from previous figures, while Services PMI is expected to remain robust at 54.2.

US Dollar Index (DXY)

Dollar Index

The Dollar Index is trading below a pivot point level of t $104.168. The index shows immediate resistance at $104.417, followed by further barriers at $104.680 and $104.987. On the downside, immediate support is found at $103.767, with subsequent levels at $103.398 and $102.911, marking critical junctures for potential reversals or accelerations in momentum.

Technical indicators reveal a mixed sentiment: the 50-Day Exponential Moving Average (EMA) is slightly above the pivot at $104.190, indicating near-term bullish undercurrents, while the 200-Day EMA at $103.765 suggests a broader supportive base. However, an upward trendline breakout at $103.850 hints at an emerging selling trend, underscoring the market’s current volatility.

The overall trend for the Dollar Index leans bearish below the pivot point of $104.168, suggesting that unless it breaches this threshold, the bearish sentiment is likely to persist.

EUR/USD Technical Forecast

EUR/USD Price Chart – Source: Tradingview

The EUR/USD pair, currently at $1.08517, reflects a gain of +0.31% over the past 24 hours, signaling a bullish sentiment in the market. The pivot point sits at $1.08208, with immediate resistance and support levels identified at $1.08576 and $1.07907, respectively.

Further resistance is anticipated at $1.08872 and $1.09269, with additional supports at $1.07615 and $1.07331. The 50-Day and 200-Day Exponential Moving Averages, at $1.07861 and $1.08215, respectively, bolster a bullish outlook.

The trend remains bullish above $1.08208, suggesting potential for continued upward movement if key levels hold.

GBP/USD Technical Forecast

GBP/USD Price Chart – Source: Tradingview

The GBP/USD pair stands at $1.26741, registering a rise of +0.29%. This movement suggests a modest bullish momentum within the 4-hour trading window. The pivot point is set at $1.26280, delineating the boundary between potential gains and retracements. Immediate resistance is observed at $1.26693, with subsequent levels at $1.27171 and $1.27586 indicating the path for further upward movement.

Conversely, support levels are established at $1.25778, with additional thresholds at $1.25850 and $1.25018 serving as buffers against downward trends. The 50-Day and 200-Day Exponential Moving Averages, positioned at $1.26133 and $1.26359 respectively, further support a bullish outlook.

The overall trend for GBP/USD remains bullish above the pivot point of $1.26280, highlighting a conducive environment for gains provided these levels are maintained or surpassed.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Arslan Aliauthor

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.