As we head into Monday, February 24, 2025, global markets are set to react to key economic data releases and geopolitical developments. The U.S. dollar remains the central focus as traders digest recent macroeconomic indicators, including GDP data, PCE inflation figures, and the Fed’s stance on monetary policy.
In the currency markets, EUR/USD struggled to maintain its upside momentum, retracing gains as mixed U.S. data and hawkish Fed expectations weighed on the euro. Meanwhile, USD/CAD surged amid a rebound in the greenback and weaker-than-expected Canadian GDP figures. AUD/USD extended its decline as risk sentiment deteriorated and economic concerns mounted in Australia.
EUR/USD
Technicals in Focus
The EUR/USD pair showed signs of exhaustion after an initial rally, closing near 1.0457 after reaching an intraday high of 1.0503. The pair was weighed down by the stronger U.S. dollar and uncertainty over the ECB’s monetary stance.
- MACD Indicator: Hovering near the zero line, signaling indecision.
- Stochastic Oscillator: Moving lower, indicating bearish momentum.
- RSI (14-day): In neutral territory, suggesting a consolidation phase.
Trading Strategy: Neutral to Sell
- Sell below 1.0460-1.0440 with targets at 1.0410-1.0380 and 1.0350-1.0320, with a stop loss above 1.0490.
- Buy above 1.0490 with targets at 1.0520-1.0550, with stops below 1.0460.
USD/CAD
Technicals in Focus
USD/CAD experienced a strong bullish breakout, rising to 1.4229 before retracing slightly. This movement was driven by a stronger U.S. dollar, weaker Canadian GDP data, and fluctuations in oil prices.
- MACD Indicator: Firmly in bullish territory, confirming upside momentum.
- Stochastic Oscillator: Approaching overbought levels, suggesting possible profit-taking.
- RSI (14-day): Strengthening, reflecting bullish sentiment.
Trading Strategy: Neutral to Buy
- Buy above 1.4210-1.4190 with targets at 1.4250-1.4280 and 1.4310-1.4350, with stops below 1.4170.
- Sell below 1.4170 with targets at 1.4140-1.4100, with stops above 1.4210.
AUD/USD
Technicals in Focus
AUD/USD continued its downward trajectory, dropping to 0.6354 as risk-off sentiment and disappointing Australian economic data pressured the currency.
- MACD Indicator: Below the zero line, indicating bearish momentum.
- Stochastic Oscillator: Deep in oversold territory, signaling potential for a short-term bounce.
- RSI (14-day): Weak, suggesting further downside risk.
Trading Strategy: Neutral to Sell
- Sell below 0.6370-0.6350 with targets at 0.6320-0.6290 and 0.6260-0.6230, with stops above 0.6390.
- Buy above 0.6390 with targets at 0.6420-0.6450, with stops below 0.6350.
Market Outlook
Looking ahead, traders will focus on U.S. Core PCE Price Index data, which could influence expectations for the Fed’s next move. In addition, Canadian GDP and European inflation figures will play a key role in shaping sentiment for USD/CAD and EUR/USD, respectively.
Overall, volatility is expected to remain elevated, with markets sensitive to any shifts in monetary policy rhetoric from central banks. Traders should stay alert to risk sentiment fluctuations, especially given recent movements in commodities and bond yields.