Midday Update: Global PMIs takes center stage ahead of ECB Policy Meeting

Markets are currently in a wait-and-see mode, with investors awaiting key economic data releases and central bank pronouncements. Technical factors are also playing a role, with indices trading at all-time highs and forex pairs recovering on dollar weakness. The remainder of the week is likely to be volatile, with the potential for significant swings depending on incoming data and events.

EURUSD was up +0.47% in the London session as the markets remain rangebound between the 1.08444 low and 1.09162 high. Investors eye US PMI data due for release early New York session.

DXY (US Dollar Index) was slightly down by -0.46% after making a 2024 high above the 103.692 level and a break below the 102.982 level could reinforce the weakness in the index. US jobs data and housing data is a major driver for the week.

GBPUSD is up modestly by +0.67%, as bulls trade towards the 1.27865 high. A break above that high could boost bullish sentiment and 1.2800 would be the next resistance. Better-than-expected UK PMIs remain major tailwinds behind bullish optimism.

EURGBP was down -0.17% after breaching major support at the 0.85492 level. A recovery from that low could see bulls faced with the 0.85939 high. The proxy suggests general weakness in the Euro ahead of the ECB policy meeting on Thursday afternoon.

The US100 rose by +0.63%, as bulls made a fresh all-time high after breaching the 17454.5 high. Technically, the index has experienced parabolic gains and could test the 18000 psychological figure in the near term if bulls maintain the weekly support at the 17284.1 level. A dip below that support might indicate a near-term pullback. Fundamentally, investor sentiment remains cautiously optimistic, supported by positive earnings reports and hopes for a soft landing in the US economy.

US30 was slightly up by +0.14% hovering around 38,108.92. Technically, the index is rangebound between the 37,802.35, low and 38,108.92 high despite trading at an all-time high. Dow components’ earnings reports will be key drivers in the coming days.

FTSE100 quickly gave up earlier gains despite positive UK PMI data. The index was flat at -0.04% as bulls retreated from the 7539.3 level after 5-day gains from the 7400 level.

CAC40 was slightly positive, up +0.28% as bulls flirt with the 7453.9 level. A break above that level could open the way for the 7493.4 level.

DAX40 was up marginally by +1.00% as bulls aim for the 16966.51 high after finding near-term support at the 16348 level. German economic data and the ongoing energy crisis will be key factors to watch.

In commodities, Gold is currently trading inside a tight range between the 2039.4 resistance level and 2016.66 support. The yellow metal was up +0.13% in the London session as bulls attempted a break above the 2039.4 level. Gold could benefit from safe-haven flows if risk aversion picks up, but rising interest rates could put downward pressure on prices.