As we head into Friday, February 28, 2025, global markets are reacting to the latest economic data releases, with heightened volatility expected across major currency pairs. The U.S. dollar remains in focus following key data releases, including GDP growth, Core PCE inflation, and jobless claims, which have influenced market sentiment. Additionally, risk sentiment remains fragile as traders assess central bank outlooks and economic stability.
EUR/USD
Technicals in Focus
The EUR/USD pair faced a sharp decline, closing around the 1.0412 level after experiencing significant bearish momentum. The pair initially traded within a tight range before breaking lower as U.S. economic data supported the dollar. The MACD indicator shows increasing bearish momentum, while the Stochastic Oscillator has entered oversold territory, indicating a potential slowdown in selling pressure. The 14-day RSI remains weak, reflecting the pair’s bearish trend.
Trading Strategy: Neutral to Sell
- Sell below 1.0430-1.0410 with targets at 1.0380-1.0350 and 1.0320-1.0300, with a stop loss above 1.0460.
- Alternatively, buy above 1.0460 with targets of 1.0480-1.0510, with stops below 1.0410.
USD/CAD
Technicals in Focus
The USD/CAD pair surged sharply, reaching the 1.4426 level as the U.S. dollar gained strength. A significant bullish breakout occurred following the release of U.S. GDP and durable goods orders, which exceeded expectations, strengthening the greenback. The MACD indicator is in positive territory, signaling strong upward momentum, while the Stochastic Oscillator is approaching overbought levels. The 14-day RSI remains elevated, suggesting further upside potential but also warning of possible exhaustion.
Trading Strategy: Neutral to Buy
- Buy above 1.4400-1.4430 with targets at 1.4450-1.4480 and 1.4510-1.4540, with a stop loss below 1.4370.
- Alternatively, sell below 1.4370 with targets of 1.4340-1.4310, with stops above 1.4420.
AUD/USD
Technicals in Focus
The AUD/USD pair saw heavy selling pressure, plunging to 0.6251 as risk sentiment deteriorated. The pair faced a sharp decline following the release of U.S. economic data, particularly GDP growth and jobless claims, which bolstered the U.S. dollar. The MACD indicator remains bearish, confirming strong selling momentum, while the Stochastic Oscillator is in oversold territory. The 14-day RSI is weak, suggesting a continuation of the downward trend unless a reversal occurs.
Trading Strategy: Neutral to Sell
- Sell below 0.6270-0.6250 with targets at 0.6220-0.6200 and 0.6170-0.6150, with a stop loss above 0.6300.
- Alternatively, buy above 0.6300 with targets of 0.6330-0.6350, with stops below 0.6250.
Market Outlook
Looking ahead, traders will focus on U.S. Core PCE inflation, the Goods Trade Balance, and Canadian GDP data, which could drive further volatility. The U.S. dollar remains strong following better-than-expected GDP growth and durable goods orders, which have reinforced expectations that the Federal Reserve may delay interest rate cuts. Meanwhile, risk-sensitive assets like the Australian dollar remain under pressure, while USD/CAD continues to be influenced by oil price movements and Canadian GDP data.
Overall, the market is expected to remain highly sensitive to economic data releases, with further volatility likely as traders position themselves ahead of next week’s central bank speeches and inflation reports.