Forex Market Analysis: US Dollar’s Uncertainty, Tech Stocks Surge, Bitcoin Nears Record Highs

March 5, 2024

US Dollar’s Uncertain Direction Ahead of Key Events

  • The US dollar shows no clear trend as it awaits significant US events.
  • Federal Reserve Chair Powell’s upcoming testimony to Congress is a potential volatility trigger.

Technical Analysis on Major Currency Pairs

  • The article provides a technical outlook for the EUR/USD, GBP/USD, and USD/CAD pairs.

Mixed Performance Against Major Counterparts

  • Despite some gains, the US dollar’s appeal is inconsistent, even with rising US Treasury rates boosting it in theory.

Market Caution Due to Packed Economic Calendar

  • Traders are wary of taking significant positions due to a busy economic schedule that could increase market volatility, including ISM services data, Powell’s Congressional testimony, and the US NFP report.

Focus on Powell’s Testimony

  • Powell is expected to maintain a stance of no immediate need for easing monetary policy, following stagnant progress on disinflation from recent CPI, PPI, and PCE data.
  • A hawkish surprise from Powell could raise yields and support the US dollar.


Stock Market Retreats from Record Highs

  • S&P 500, Nasdaq, and Dow Jones Industrial Average saw declines amid investor caution.
  • Federal Reserve Chair Jerome Powell’s testimony and upcoming jobs report could challenge recent equity gains.

Impact on Major Indexes

  • S&P 500 slightly down, breaking its streak of weekly wins.
  • Dow Jones drops by 0.2%; Nasdaq falls by 0.4%, influenced by declines in Apple and Tesla shares.

Tech Sector Rally and Bubble Concerns

  • Nasdaq’s recent high fueled by AI-driven tech stock run-up.
  • Nvidia’s valuation reaches $2 trillion, raising bubble concerns, though not all analysts are alarmed.

Cryptocurrency and Commodities Performance

  • Bitcoin approaches record highs with over 7% gain.
  • Gold futures hit a record, with April contracts at $2126.3 per ounce.
  • Japan’s Nikkei 225 surpasses 40,000 level for the first time.

Upcoming Economic Indicators

  • Powell’s testimony and February jobs data anticipated to influence interest rate decisions and economic outlook.

Regulatory Actions and Market Movements

  • EU fines Apple $2 billion over App Store restrictions, impacting its shares.
  • Super Micro Computer surges before joining S&P 500; Macy’s stock up after increased buyout offer.
  • Spirit Airlines and JetBlue stocks fluctuate following the termination of their merger agreement.

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