US stock rallied sharply on Wednesday after falling in the past four consecutive days. The Dow Jones rose by more than 600 points while the tech-heavy Nasdaq 100 index rose by over 373 points. Some of the biggest winners were technology companies like Bumble, Figs, Carvana and United Airlines, which rose by more than 10%. On the other hand, the CBOE Volatility index crashed by almost 8% while energy groups like Marathon Oil, ExxonMobil, and Pioneer Natural Resources crashed. Still, it is unclear whether Wednesday’s gains will hold because of how volatile the markets have been lately.
The euro bounced back on Thursday morning as investors waited for the upcoming Eurogroup meeting and the interest rate decision by the European Central Bank (ECB). Analysts expect that European leaders will announce a new round of stimulus in a bid to prevent the bloc from going into a recession. At the same time, they will deliberate on how to reduce their dependence on Russian oil and gas. On the other hand, analysts believe that the ECB will decide to be more dovish in a bid to support the economy.
The US dollar strength took a breather as the VIX index dropped. Data published by the American labor department showed that the country’s vacancies rose to over 11 million people as companies continued recovering. The data came a few days after the US said that its total unemployment rate dropped to 3.8% in February. Later today, the US will publish the latest consumer inflation data. Analysts expect the data to show that the headline CPI jumped to 7.9% in February while core CPI dropped slightly to 5.9%.
EURUSD
The EURUSD pair has been in a strong bearish trend in the past few days. It fell to a low of 1.0805. It has bounced back in the past 2 days and is trading at 1.1045. On the four-hour chart, the pair has managed to move above the 25-day and 50-day moving averages. It is also approaching the 38.2% Fibonacci retracement level. Therefore, the pair will likely keep rising as bulls target the next key resistance at 1.1150, which is along the 50% retracement level.
USDMXN
The USDMXN pair dropped sharply as most emerging market currencies rose. It moved to a low of 20.93, which is the lowest it has been since March 7. This price is substantially below this week’s high of 21.50. On the four-hour chart, the pair has moved below the 25-day moving average while the Relative Strength Index has moved to the oversold level. Therefore, the pair will likely keep falling in the near term.
NAS100
The Nasdaq 100 index rose as the significant sell-off took a rest. The index is trading at $13,460, which is significantly higher than this week’s low of $13,095. On the four-hour chart, the index is slightly above the middle line of the Bollinger Bands while the Relative Strength Index (RSI) has moved from the oversold level. Therefore, the index will likely keep rising in the coming days.
