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    Forex trading plan for March 3

    The market’s risk sentiment improved on Wednesday because of the recovery in oil prices and better economic figures in the United States, Australia and other economies. China’s decision to cut in bank reserve requirements and conduct structural reforms earlier this week was also a positive factor. Moody's worsened outlook on Chinese government debt from "stable" to "negative", but it didn’t change the moderate optimism of the market. Oil prices also matter: watch US crude inventories figures later on Wednesday. American ADP non-farm employment change was better than expected at 214K (forecast: 185K). Watch ISM non-manufacturing PMI at 15:00 GMT.

    EUR/USD reached support at 1.0830. The euro may now undergo a short period of correction/consolidation limited by 1.0935/60. Next support levels are at 1.0800 and 1.0710. The approaching ECB’s meeting, which will take place next Thursday, is still affecting the euro. This pressure will likely persist.

    We see two lows of GBP/USD on the hourly chart above 1.3900, higher than this week’s low of 1.3835. The oversold pair is trying to base, though resistance is at 1.4035/50 (23.6% Fibo of February decline). Only above these levels sterling will get chance to recover to 1.4150. British construction PMI also came out below expectations, though, all in all, the reading was at OK level. Services PMI due at 09:30 GMT on Thursday will be more important. Support will remain at 1.3900.  

    USD/JPY rose on higher US yields. There’s scope for an increase to 115.00, but it won’t be easy for the pair to get much higher. Support is at 113.50 and 112.85.

    Australian economic growth in Q4 turned out better than expected ( 0.6% vs. 0.5%), while the previous reading was revised to the upside. Australia’s trade balance is due at 00:30 GMT. Upward momentum for AUD/USD has declined, and 200-day MA (0.7260) won’t be an easy obstacle to overcome. Support is at 0.7150 and 0.7110/00. We see more downside for EUR/AUD.

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