According to BofA’s month-end fixing model, the dollar is the one favoured as we look to wrap up March and Q1 trading in the coming days. This fits with what was pointed out by both Credit Agricole and Barclays earlier here.Of note, BofA says that:”Our estimates suggest the potential for (1) material inflows into USD-denominated assets (c.+1.0σ) and to a lesser extend EUR assets (c.0.2σ), vs (2) outflows from JPY (c.-1.7σ), EM (c.-1.4σ) and GBP (c.-1.1σ) assets.”The rebalancing against the yen and sterling fits with what Barclays was also arguing with their own model as well. So, that is something to take note of just in case.However, BofA does point out that USD/CHF might be the biggest beneficiary in closing out the month:”The direction of travel clearly suggests strong USD/CHF buying, driven primarily by the sharp drawdown in US equities. With bond returns also posting negative returns, we think this could be one of the larger USD/CHF buying months of the year. The signal has been consistent enough for us to have confidence in the direction of flows.”The currency pair had a solid run higher last week, gaining 1.4% and is now trying to test resistance around the 0.8000 mark. However, the pair did break above its 200-day moving average at the end of last week. That sees it trade above both key daily moving averages for the first time since March 2025. So, that in itself could be an impetus for further upside potential in the pair. This article was written by Justin Low at investinglive.com. 🔗 Source 💡 DMK Insight The dollar’s bullish outlook as Q1 wraps up is crucial for traders right now. With BofA’s month-end fixing model signaling a preference for the dollar, traders should consider how this aligns with broader market trends. Both Credit Agricole and Barclays echo this sentiment, suggesting a potential strengthening of the dollar against major currencies. This could impact forex pairs significantly, especially those involving the euro and yen, as traders reposition ahead of the month-end and quarter-end flows. Keep an eye on key resistance levels for the dollar index, as a breakout could trigger further buying momentum. However, it’s worth questioning whether this dollar strength is sustainable. If economic data releases in the coming days disappoint, we could see a quick reversal. Watch for upcoming U.S. economic indicators that might influence sentiment, particularly any surprises in employment or inflation data. The immediate focus should be on how the dollar performs against its peers as we approach the end of March. 📮 Takeaway Monitor the dollar index for potential breakout levels as Q1 ends; key economic data releases could shift momentum quickly.

Euro area economic confidence slipped to 96.6 in March, after recording a revised 98.2 reading in February. That’s the lowest estimate since September with consumer confidence (-16.3) also falling back on the month to its lowest since the latter months of 2023.It’s all coming undone as the US-Iran war stirs up inflation fears in Europe once again. That as energy prices in the region are surging as the conflict spreads through the Middle East, with disruptions to key gas facilities – in particular Qatar.The risk now is that the conflict drags on for longer, and that might see higher prices become more entrenched. In turn, that will feed into broader price pressures in general. The ECB had previously been looking to potential rate cuts if and when German inflation settles, but that particular playbook is now thrown out the window. Interest rate hikes are back on the menu instead.In terms of consumer inflation expectations, the index there is seen rising to 43.4 in the latest report. That is a sharp jump and marks the highest since July 2022.Meanwhile, selling price expectations also rose to 19.7 – up from 11.5 previously. And that is another marked increase to its highest since February 2023.The trend is pointing to a somewhat repeat episode of the 2021-22 inflation scare brought about by the Russia-Ukraine conflict. For now, things are more measured with the energy price spike being not as drastic. But again if the situation carries on for longer, the risk of it becoming more and more profound is going to increase day by day. This article was written by Justin Low at investinglive.com. 🔗 Source 💡 DMK Insight Euro area economic confidence just hit a low not seen since September, and here’s why that matters: The drop to 96.6 from February’s 98.2 signals growing unease among consumers and businesses, likely impacting spending and investment decisions. With consumer confidence now at -16.3, traders should brace for potential ripple effects across the Eurozone markets. This decline comes at a precarious time, as geopolitical tensions, particularly the US-Iran conflict, could exacerbate economic instability. If these tensions escalate, we might see increased volatility in related assets like the euro and European equities. Keep an eye on the EUR/USD pair; a breach below key support levels could trigger further selling pressure. Additionally, monitor how this sentiment shift affects the European Central Bank’s policy decisions in upcoming meetings, as they may need to adjust their stance in response to weakening economic indicators. Watch for any updates on geopolitical developments and economic data releases that could further influence market sentiment. The next few weeks will be crucial for gauging the Eurozone’s resilience amid these challenges. 📮 Takeaway Traders should monitor EUR/USD closely; a break below key support levels could signal further downside as economic confidence wanes.

No direct talks with the US took place, only messages via intermediaries Proposals conveyed to Iran have mostly been ‘unrealistic, unreasonable and excessive’Tehran is dismissing reports of direct negotiations with Washington, clarifying that recent diplomatic exchanges have been limited to messages conveyed through third-party intermediaries. Iranian Foreign Ministry spokesperson, Esmaeil Baghaei, emphasized that these communications do not constitute formal “talks,” reiterating the long-standing refusal to engage in direct dialogue under current conditions.According to the Foreign Ministry, the proposals received from the US via these mediators have been largely characterized as “unrealistic, unreasonable, and excessive.” Iranian officials suggest that the terms presented by the US side fail to account for regional realities and represent a “maximalist” approach that Tehran is unwilling to engage. The spokesperson noted that Iran’s leadership has reviewed the messages but found the demands to be deceptive, suggesting they are part of a broader strategy to exert pressure rather than a sincere effort at diplomacy.This stance comes amid a backdrop of heightened tensions, with Tehran pointing to past experiences with American diplomacy as a primary reason for its current skepticism. Specifically, Iranian officials cited instances where they claim the US initiated military actions or applied new sanctions while diplomatic channels were still active. As a result, the Foreign Ministry maintained that the country’s current focus remains on national defense and sovereignty rather than entering into what it views as a lopsided negotiating framework.While several regional “friendly countries”, including Pakistan and Oman, have attempted to facilitate a breakthrough, Iran has remained firm that it will only consider an end to hostilities on its own terms. These conditions reportedly include the total cessation of “aggression and assassinations,” guaranteed reparations for war damages, and formal recognition of Iran’s sovereign rights. Until such conditions are met, the Foreign Ministry indicates that any messages from Washington will continue to be viewed as insufficient. This article was written by Giuseppe Dellamotta at investinglive.com. 🔗 Source 💡 DMK Insight So, Iran’s dismissing direct talks with the US, and here’s why that matters: this could keep geopolitical tensions high, impacting oil prices and broader market sentiment. With the ongoing uncertainty, traders should keep an eye on oil futures, especially if tensions escalate further. If Iran continues to reject proposals, we might see a spike in volatility in energy markets, which could ripple into currencies like the Iranian Rial and even the Euro, given Europe’s reliance on oil imports. Watch for key resistance levels in crude oil; a break above recent highs could signal a bullish trend, while a failure to hold could lead to a pullback. On the flip side, if any unexpected diplomatic breakthroughs occur, it could lead to a sharp reversal in oil prices, so staying alert to news updates is crucial. Keep an eye on the next few weeks for any shifts in rhetoric or proposals that could change the landscape. 📮 Takeaway Monitor oil prices closely; any escalation in tensions could push crude above key resistance levels, impacting related currencies and markets.

FUNDAMENTAL OVERVIEWThe S&P 500 broke through a key support on Friday and extended the losses into new lows as traders hedged into the weekend risk. Those hedges are being unwound today given that nothing happened over the weekend. The focus remains solely on the US-Iran negotiations and there’s some cautious optimism as Pakistan confirmed that negotiations may take place in Islamabad in the coming days and Trump said that they are performing extremely well and they could make a deal pretty soon, although he added that they might fail as well.The path of least resistance remains to the downside until we get a resolution. Traders will keep a watchful eye on the headlines and especially on Trump’s Truth Social account, as we are always one post away from huge market moves. Trump’s ceasefire expires on April 6, so there’s a chance we get a deal before that as failure to reach one would increase substantially recession risks. S&P 500 TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that the S&P 500 broke through the key support around the 6,525 level again on Friday and eventually extended the losses into the 6,363 level before bouncing. From a risk management perspective, the sellers will have a better risk to reward setup around the broken support turned resistance to position for new lows. The buyers, on the other hand, will want to see the price breaking higher to extend the pullback into the major trendline.S&P 500 TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we have a minor downward trendline defining the bearish momentum. The sellers will likely lean on the trendline with a defined risk above it to keep pushing into new lows, while the buyers will look for a break to extend the pullback into the 6,525 resistance.S&P 500 TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, there’s not much we can add here as the sellers will look for a rejection around the trendline, while the buyers will look for a break. The red lines define average daily range for today. UPCOMING CATALYSTSToday we have Fed Chair Powell speaking. Tomorrow, we get the US Consumer Confidence and US Job Openings data. On Wednesday, we have the US ADP, the US Retail Sales and the US ISM Manufacturing PMI. On Thursday, we get the latest US Jobless Claims figures. On Friday, we conclude the week with the US NFP report. This article was written by Giuseppe Dellamotta at investinglive.com. 🔗 Source 💡 DMK Insight The S&P 500’s breach of key support signals potential volatility ahead, and here’s why that matters for crypto traders. With SOL currently at $83.88, the correlation between traditional markets and crypto is tightening. As traders unwind hedges, we might see a temporary relief rally, but the underlying uncertainty from US-Iran negotiations could trigger renewed selling pressure. If the S&P fails to reclaim its support, expect SOL and other altcoins to react negatively, especially if risk-off sentiment prevails. Watch for SOL to hold above $80 to maintain bullish momentum; a drop below could lead to a retest of lower levels. Keep an eye on broader market sentiment and any developments in geopolitical tensions, as these could influence trading strategies significantly. 📮 Takeaway Monitor SOL’s price action around $80; a break below could signal further downside risk amid S&P 500 volatility.

Thursday‘s unilateral ceasefire into the close annoncement causing S&P 500 to rip, and how much time it bought? That announcement level was broken even before European session, and it was downhill pretty much since. 🔗 Source 💡 DMK Insight The S&P 500’s spike on the ceasefire announcement was short-lived, and here’s why that matters: Traders often react to geopolitical news with initial enthusiasm, but the quick reversal indicates underlying weakness. The market broke the announcement level before the European session, suggesting that the optimism was fleeting and that traders are skeptical about the sustainability of such gains. This could signal a shift in sentiment, with many now looking for reasons to sell rather than hold. Keep an eye on key support levels; if the S&P 500 fails to hold above recent lows, we might see a more significant downturn. Moreover, this volatility could spill over into related markets, particularly in sectors sensitive to geopolitical tensions, such as energy and defense stocks. If the S&P continues to slide, it might trigger a broader risk-off sentiment, impacting not just equities but also commodities and currencies tied to economic stability. Watch for the next few trading sessions to gauge whether this is a mere correction or the start of a more pronounced bearish trend. 📮 Takeaway Monitor the S&P 500’s support levels closely; a failure to hold could lead to a broader market sell-off in the coming days.

Here’s a brief recap of important developments that occurred over the weekend as the Middle East war enters its fifth week, with no signs of any truce. 🔗 Source 💡 DMK Insight The ongoing conflict in the Middle East is creating significant volatility in global markets, and here’s why traders need to pay attention. As the war enters its fifth week with no signs of a truce, geopolitical tensions are likely to impact oil prices and, by extension, currencies tied to energy exports. Traders should keep an eye on crude oil futures; a sustained rise above key resistance levels could trigger further inflationary pressures globally. This situation may also affect safe-haven assets like gold and the US dollar, as investors seek refuge from uncertainty. But here’s the flip side: if the conflict escalates, it could lead to supply chain disruptions that might benefit certain sectors while punishing others. Look for sectors like defense and energy to potentially outperform, while consumer discretionary could face headwinds. Monitoring the daily price movements of crude oil and gold will be crucial in the coming weeks, especially as market sentiment shifts with news updates from the region. 📮 Takeaway Watch for crude oil prices; a breakout above key resistance could signal broader market implications, especially for currencies and inflation.

The Australian Dollar (AUD) trades lower against its major currency peers at the start of the week, trading 0.27% lower to near 0.6850 against the US Dollar (USD) in the opening trade. 🔗 Source 💡 DMK Insight The AUD’s drop to around 0.6850 against the USD signals potential volatility ahead. This decline could be tied to broader market sentiment, especially with ongoing concerns about global economic growth and interest rate decisions. Traders should keep an eye on the Reserve Bank of Australia’s upcoming statements, as any hints of policy shifts could further impact the AUD. If the AUD breaks below 0.6800, it could trigger stop-loss orders and lead to a sharper sell-off, while a rebound above 0.6900 might indicate a recovery phase. Look for correlated movements in commodities, particularly gold, which often influences the AUD given Australia’s status as a major exporter. The immediate focus should be on the daily chart for any signs of reversal or continuation patterns that could guide trading strategies in the coming days. 📮 Takeaway Watch for AUD/USD levels around 0.6800 for potential breakdowns or 0.6900 for recovery signals this week.

The Japanese Yen (JPY) continues to remain at the receiving when compared to the US Dollar (USD) as a new week begins in Asia on Monday. 🔗 Source 💡 DMK Insight The JPY’s weakness against the USD isn’t just a trend—it’s a signal of broader economic dynamics at play. As the new week kicks off, traders should pay attention to the implications of this currency pair. The ongoing strength of the USD can be attributed to persistent interest rate differentials, with the Fed maintaining a hawkish stance while the Bank of Japan remains dovish. This divergence is likely to keep the JPY under pressure, especially if economic data from Japan continues to disappoint. Look for key resistance levels in USD/JPY; if it breaks above recent highs, we could see further bullish momentum. But here’s the flip side: if any unexpected positive news comes from Japan, it could trigger a short squeeze in JPY pairs, so keep an eye on upcoming economic releases. Watch for the USD/JPY to test significant levels, as a break could lead to a cascading effect on other pairs like EUR/JPY and GBP/JPY, amplifying volatility across the board. 📮 Takeaway Watch for USD/JPY resistance levels; a break could signal further weakness in JPY and impact related currency pairs.

The EUR/USD pair extends its losing streak for the fifth trading day on Monday, trading 0.15% lower to near 1.1490 during the early Asian trading session. 🔗 Source 💡 DMK Insight The EUR/USD’s fifth consecutive day of losses signals a potential shift in market sentiment. Trading at around 1.1490, this level is critical; a sustained drop below could open the door to further declines. Traders should be aware that this trend might be influenced by broader economic indicators, particularly any shifts in U.S. monetary policy or Eurozone economic data. If the pair breaks below 1.1450, we could see a rush of selling pressure, potentially leading to a test of lower support levels. On the flip side, if the pair manages to hold above 1.1500, it might indicate a temporary bottom, prompting a potential reversal. Keep an eye on upcoming economic releases that could impact the dollar’s strength, as well as any geopolitical developments that might sway investor sentiment. Watch for the 1.1450 support level; a break could trigger further downside momentum. 📮 Takeaway Monitor the 1.1450 support level closely; a break could lead to increased selling pressure in the EUR/USD pair.