Last week several important economic updates influenced the Forex market. US preliminary GDP fell less than expected (0.6% actual vs. 0.7% forecast). Below you will find the key events to trade on during the week from August 29 to September 2.
Non-farm payrolls: what pairs to watch?
Analysts anticipate the level of non-farm payrolls to increase by 162K jobs (vs. 75K previously). At the same time, the level of average hourly earnings is forecast to advance by 0.3% (vs. 0.2% previously) and the unemployment rate is expected to stay stable at 3.6%. If the NFP and average hourly earnings are higher and the unemployment rate is lower than the forecasts, the USD will go up. Be careful with your trades as the USD gets super volatile after the release.
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The USD has got stronger ahead of the release, but will the situation change after 15:30 MT?
· On H4, EUR/USD has crossed the 1.1270 level (61.8% Fibo) and is currently moving downwards to the 1.1257 level, which lies close to the 200-period SMA and the lower border of the ascending channel. If the employment data is positive, the pair will fall below the 1.1257 level towards the next support at 1.1223. There is the possibility for EUR/USD to reach the next support at 1.1219 and test the next level at 1.1202, of bearish pressure is strong. On the other hand, if the employment data disappoints, EUR/USD will rise back to the resistance at 1.1288, jump above the 50% Fibo level and go higher to the next resistance at 1.1319.
· GBP/USD has been testing the lower border of the consolidation range at 1.2556 on H4. If the USD gets stronger on the release, the fall towards the next support at 1.2510 will be possible. From the upside, pay attention to the resistance levels at 1.2589, 1.2604 and 1.2635.
· USD/JPY has jumped above the 100-period SMA on H4 in anticipation of the release. The next resistance levels for the pair lie at 108.12, 108.36 and 108.49. In case of a negative release, USD/JPY will fall back to 107.74. If this level is broken, the next support will lie at 107.56. Stochastic indicator is about to form a crossover within the oversold zone, which may provide us selling opportunity.
Last week, there were sharp swings in USDJPY, a decline in oil prices, and a surge in Tesla stock. What's next?
Geopolitical factors and inflation remain the main drivers of financial markets. Let’s see how to use that in trading!
Main news that will drive the market in the upcoming week include CB Consumer Confidence Index, Canadian GDP, and US Core PCE Price Index
The Federal Reserve (Fed) will announce its Interest Rate Decision and make a statement about the future monetary policy on Wednesday, September 21, GMT+3. After the higher-than-expected inflation numbers published on September 13, there’s almost no doubt the Federal Reserve will come up with another 75-basis-point rate hike. However, surprised by the CPI numbers, several Fed members announced the possibility of a 100-basis-point rate hike on Wednesday.
Every week we expect many interesting events that can shake the market.