Forex And Cryptocurrencies Forecast For April 5 - 9

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First, a review of last week’s events:

EUR/USD

The U.S. economy continues to recover vigorously. This is evidenced by the impressive data from the labor market. Thus, the number of new jobs created outside the agricultural sector (NFP) has almost doubled compared to the previous period (growth from 468K to 916K) and, moreover, has exceeded the forecast (647K) by almost a third. The ISM Manufacturing PMI has risen from 60.8 to 64.7. Also, according to the ADP report, the employment rate in the private sector has increased from 176K to 517K. All this suggests that fiscal stimulation of the economy and the injection of money into it is working. But is it good for the dollar?

Of course, this scheme also includes yields on long-term US government bonds, as well as the prospects for monetary policy for the next few years. Investors are sensitive to statements by Fed Chairman Jerome Powell on the possibility of curtailing the quantitative easing (QE) program and raising the interest rate.

On the one hand, according to the statements of the management, the Federal Reserve System does not intend to raise interest rates until at least 2023. The Fed is not going to change other parameters of the quantitative easing (QE) program either, believing that injecting $1.9 trillion into the economy will be quite enough. But on the other hand, US President Joe Biden presented a massive $2.25 trillion infrastructure spending plan on Wednesday March 31, along with a financing scheme through tax increases. If, indeed, these funds arise not at the expense of the printing press, but at the expense of an increase in the tax load, this will mean the curtailment of QE, and will entail the flow of capital from the stock market to the government bond market.
But while this is all just planning, the market has frozen in anticipation, and the EUR/USD pair has moved into a sideways trend. As predicted by the majority of experts (70%), the dollar continued to strengthen at the beginning of last week, and the pair came close to 1.1700. But then, largely thanks to Biden's new plan, it turned around and went up. However, this rebound can hardly be called a trend change. The pair just returned to where it had been on March 25-30. It completed the trading week in the same zone, at the level of 1.1760;

GBP/USD

In general, the chart of this pair was similar to the chart of EUR/USD, with only one fundamental difference. If the euro continues to retreat against the dollar, the British pound, albeit with difficulty, is trying to hold the defense. This time, the UK GDP growth for the fourth quarter of 2020 to 1.3%, as well as the revised upward index of business activity came to help it.

Let us remind that, when making a forecast for the previous week, 40% of experts voted for the strengthening of the dollar, 10% for the strengthening of the pound and 50% for the sideways trend. And in general, everyone was right. The pair both fell to 1.3705, and grew to 1.3850, and eventually finished only 40 points above the start. Having started the five-day week at 1.3790, it completed it at 1.3830;

USD/JPY

Most analysts (60%) had expected this pair to consolidate above the 110.00 horizon. 100% of trend indicators and 75% of oscillators had agreed with this scenario. And it turned out to be absolutely true. The pair has been relentlessly moving north since January 6 and it renewed this year's high on Wednesday March 31, reaching 110.95.  The long-awaited correction to the south did not happen again, and the pair ended the trading session at 110.65;

Cryptocurrencies

Bitcoin is storming the $60,000 threshold again. At the time of writing, the maximum it has reached so far is $60,170. However, as soon as the benchmark cryptocurrency approaches this milestone, another wave of sales follows, causing a pullback. However, these ebbs are not large enough. And this suggests that there are fewer and fewer people willing to part with bitcoin at this level. Investors are waiting for a leap up. And these small corrections just give them the opportunity to replenish their stock of tokens on the pullback.

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Notice: These materials should not be deemed a recommendation for investment or guidance for working on financial markets: they are for informative purposes only. Trading on financial markets is ...

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