The greenback continues to be the king of the hill, following final Friday’s jaw-dropping NFP report.
Can the U.S. forex preserve holding on to its positive factors in the present day?
Earlier than shifting on, ICYMI, I’ve listed the potential financial catalysts that it’s worthwhile to be careful for this week. Verify them out earlier than you place your first trades in the present day!
And now for the headlines that rocked the markets within the final buying and selling periods:
Contemporary Market Headlines & Financial Knowledge:
Australia’s MI inflation gauge slowed from 1.0% m/m acquire in December to a meager 0.3% uptick in January 2024
New Zealand ANZ commodity costs dipped from 2.4% month-over-month to 2.2% in January regardless of improve in butter costs
Fed head Jerome Powell reiterates that they’re on monitor to chop rates of interest this yr with inflation slowing down
Australia’s ANZ job ads elevated from upgraded 0.6% month-to-month uptick in December to 1.7% acquire in January, suggesting stronger hiring prospects down the road
Australian items commerce surplus narrowed from upgraded 11.76B AUD to 10.96B AUD in December as exports rose 1.8% whereas imports grew 4.8%
Chinese language Caixin providers PMI fell from 52.9 to 52.7 vs. 53.0 forecast for January, reflecting slower tempo of trade development
Value Motion Information
Overlay of USD vs. Main Currencies Chart by TradingView
The Buck pulled off a mighty robust end on Friday, due to a a lot stronger than anticipated U.S. jobs report that strengthened the “greater for longer” rate of interest outlook.
Not even Fed head Powell’s remarks throughout his interview with 60 Minutes earlier in the present day was sufficient to derail the greenback from its climb, nevertheless it’s price noting that he reiterated the potential of easing later this yr on account of slowing inflation.
The U.S. greenback nonetheless managed to squeeze out just a few extra positive factors in opposition to its lower-yielding rivals just like the yen and franc.
Upcoming Potential Catalysts on the Financial Calendar:
U.S. ISM providers PMI at 3:00 pm GMT
BOE MPC member Capsule’s speech at 5:30 pm GMT
FOMC member Bostic’s testimony at 7:00 pm GMT
Japanese common money earnings and family spending at 11:30 pm GMT
RBA financial coverage determination at 12:30 am GMT (Feb. 6)
Use our new Foreign money Warmth Map to shortly see a visible overview of the foreign exchange market’s value motion! ️
AUD/USD 15-min Foreign exchange Chart by TradingView
Greenback demand continues to be the secret up to now, as risk-off flows are additionally in play to tug higher-yielding currencies south.
In any case, China simply printed a weaker than anticipated Caixin providers PMI which mirrored a slower tempo of trade development. Not even the RRR minimize from the PBOC appeared sufficient to prop up the Aussie, as this transfer was already introduced approach again.
AUD/USD already fell sharply after final Friday’s NFP launch however appears to be discovering some assist at .6485 and is in the course of a pullback.
Making use of the Fib software on the newest transfer reveals that the 38.2% stage is close to the pivot level (.6540) that could be sufficient to draw sellers.
If that’s the case, the pair might resume its slide and fall again to the swing low and even the following draw back targets at S1 (.6470) then S2 (.6430).
Don’t overlook that Uncle Sam has the ISM providers PMI lined up in in the present day’s New York session, though the worth response may very well be muted except it aligns with hawkish Fed expectations.
Additionally, the RBA is gearing as much as make its rate of interest determination within the subsequent Asian session, so AUD/USD could be in for lots of volatility!
