Trading Week Ahead: Middle East Conflict Shocks Markets

Markets enter the week under the shadow of escalating Middle East tensions. Joint US-Israeli strikes on Iran, and the risk of wider regional spillover, have sent oil sharply higher and pushed gold into rally mode, raising fresh concerns about renewed inflation pressure. Against this volatile backdrop, Eurozone CPI, US Retail Sales, and Nonfarm Payrolls will test whether economic fundamentals can offset geopolitical risk.

👉 Eurozone CPI

Inflation is forecast to hold steady at 1.7%, unchanged from the previous reading. A surprise to the upside could lift EUR and push European yields higher. A softer print may strengthen expectations of further ECB easing and weigh on the euro.

👉 US Retail Sales

Consumer spending is expected to contract by 0.3% after a flat 0.0% print previously. A stronger-than-expected result could support USD and challenge rate cut bets. A deeper decline may pressure the dollar and boost risk sentiment.

👉 Nonfarm Payrolls

Job creation is forecast to slow sharply to 58,000 from 130,000 previously. A solid upside surprise would reinforce confidence in the US economy and lift yields. A weak report could trigger broad volatility across currencies, bonds, and equities.

Date	Time	Instrument	Event
Monday, Mar. 2	4:00 PM	USD	ISM Manufacturing PMI
Tuesday, Mar. 3	11:00 AM	EUR	CPI
		GBP	Spring Forecast Statement
	1:30 PM	GBP	Annual Budget Release
Wednesday, Mar. 4	2:15 PM	USD	ADP Non-Farm Employment Change
	4:00 PM	USD	ISM Services PMI
Thursday, Mar. 5	2:30 PM	USD	Unemployment Claims
Friday, Mar. 6	USD	Nonfarm Payrolls
	USD	Unemployment Rate
	USD	Average Hourly Earnings
	3:30 PM	USD	Retail Sales

*All times in the table are in GMT+1

Technical Analysis with FVG Strategy

This technical analysis uses the EMA 20 and EMA 50 to determine market trends, alongside the Fair Value Gap (FVG), which refers to price imbalances caused by aggressive movements, signalling key entry and exit points. This strategy applies to EURUSD, GBPJPY, US100, and XAUUSD, providing insights into both last week’s market opportunities and the current one.

Opportunities to Watch This Week

EURUSD

Market Context: EURUSD retested support, swept liquidity below it, and is now trading under both the 20 and 50 EMAs, signalling short-term bearish pressure. However, today’s aggressive open driven by geopolitical tensions was followed by a strong buyer reaction from support, pushing price higher again.

Bullish Scenario (Preferred): The strong rebound from support suggests buyer dominance, with potential upside toward last week’s untested close.

Bearish Scenario (Alternative): Failure to hold support, confirmed by a full candle close below the level, could trigger a deeper selloff into the next support zone.

FVG Setup: No FVG formed despite today’s volatility. However, lower-timeframe FVG setups may align with the preferred bullish scenario.

GBPJPY

Market Context: After last week’s strong rally and precise reaction from the predefined resistance zone, GBPJPY began a sharp selloff from Thursday, moving back toward support.

Bullish Scenario (Preferred): A reaction from support could lead to renewed buying interest, targeting the marked swing high at resistance.

Bearish Scenario (Alternative): A full candle close below support would likely trigger a sweep of the swing low range and potentially extend lower.

FVG Setup: A long FVG formed this week and is already active. It may still offer opportunities from the support zone.

XAUUSD

Market Context: Gold remains in a strong bullish trend amid geopolitical uncertainty, acting as a safe-haven asset. This continued demand is reflected in price action, with gold now approaching new all-time highs.

Bullish Scenario (Preferred): Continuation higher toward all-time high remains the primary outlook.

Bearish Scenario (Alternative): A short-term pullback within the broader uptrend may occur, though without a structural shift.

FVG Setup: Last Tuesday’s bullish FVG reached its 2:1 RRR target. If a new bullish FVG forms, it may provide an entry opportunity targeting new all-time highs.

US100

Market Context: Market structure remains clearly bearish, reinforced by today’s gap down from Friday’s close.

Bearish Scenario (Preferred): Continuation lower with a potential sweep of the marked swing lows.

Bullish Scenario (Alternative): A short-term rebound toward Friday’s close could occur, where sellers may re-enter and resume downside pressure.

FVG Setup: No new FVG was formed this week, but setups may develop on lower timeframes in line with the bearish bias.

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