2024-09-03 10:19
Oil prices eased on Tuesday as concerns about Chinese demand intensified. Market participants awaited the crucial US nonfarm payrolls report. Economists expect the US unemployment rate to ease slightly to 4.2% in August. The USD/CAD price analysis leans bullish, with the Canadian dollar falling due to a decline in oil prices. At the same time, investors remained cautious as markets prepared for the US monthly employment report. –Are you interested to learn more about day trading brokers? Check our detailed guide- Oil prices eased Tuesday as Chinese demand concerns intensified, overshadowing Libya’s supply worries. A drop in oil weakens the Canadian dollar, a commodity currency. Canada mainly exports oil, so its currency moves with oil prices. Meanwhile, the US dollar strengthened against the weak loonie as market participants awaited the crucial US nonfarm payrolls report. The greenback had a strong rally last week as data revealed a resilient US economy, reducing the likelihood of an aggressive Fed rate-cutting cycle. At the same time, fears of a looming recession eased as hopes of a soft landing increased. On Friday, data showed that inflation increased as expected. This relieved pressure on the Fed to implement significant rate cuts. Nevertheless, investors are still fully pricing a rate cut in September. Market focus has now shifted to this week’s major US employment report, which will significantly impact rate cut expectations as it did last month. The Fed is keeping a close high on the unemployment rate, which shows the likelihood of a recession. The rate unexpectedly jumped in July, raising fears of a rapid economic slowdown. Another jump could bolster bets for a super-sized 50-bps Fed rate cut in September. However, economists expect the unemployment rate to ease slightly to 4.2% in August. USD/CAD key events today US ISM Manufacturing PMI USD/CAD technical price analysis: Bulls set sights on 1.3600 On the technical side, the USD/CAD price has moved from below the 30-SMA to above it, indicating a shift in sentiment. Bulls took over after the price failed to break below the 1.3450 support level. –Are you interested to learn more about automated trading? Check our detailed guide- Bearish momentum reached maximum levels, with the RSI in the oversold region. After that, bulls took over, pushing the price above the SMA. However, the price must now make higher highs and lows to confirm a new bullish trend. In this case, the price would revisit and likely break above the 1.3600 key resistance level. https://www.forexcrunch.com/blog/2024/09/03/usd-cad-price-analysis-buyers-emerge-amid-falling-oil/
2024-09-03 08:59
Investors eyed the upcoming US nonfarm payrolls report. Economists predict a 165,000 US jobs addition in August. Data from Japan revealed that the manufacturing PMI contracted at a slower rate last month. The USD/JPY outlook is slightly bearish as the dollar retreats ahead of pivotal US employment data. Meanwhile, the yen steadied as the outlook for BoJ rate hikes improved after Japan’s manufacturing PMI report. –Are you interested to learn more about day trading brokers? Check our detailed guide- The dollar fell against the yen on Tuesday as investors eyed the upcoming US nonfarm payrolls report. Nevertheless, it remained near highs hit after the US PCE figures on Friday. Inflation increased as expected in July, increasing the likelihood of a gradual Fed rate-cutting cycle. As a result, the dollar rallied. Nevertheless, this outlook might keep shifting as investors receive more data. Notably, the next major report will show the state of the labor market. Economists predict a 165,000 jobs addition in August, bigger than the previous month. Meanwhile, the unemployment rate could ease from 4.3% to 4.2%. If the figures align with expectations, it will solidify bets for a smaller rate cut, likely boosting the dollar. On the other hand, if unemployment continues increasing, the Fed might be forced to implement a significant rate cut. Meanwhile, on Friday, data from Japan revealed that the manufacturing PMI contracted at a slower rate last month. The PMI increased from 49.1 in July to 49.8, remaining below 50. Moreover, it came in bigger than the estimates of 49.5, a sign that business activity in the manufacturing sector was rebounding faster than expected. Furthermore, the report showed that input prices grew due to a weak yen, which boosted inflation. This was a relief for the BoJ, which needs higher inflation to continue hiking interest rates. USD/JPY key events today US ISM Manufacturing PMI USD/JPY technical outlook: Price retesting SMA support On the technical side, the USD/JPY price is pulling back to retest the 30-SMA support after a strong bullish run. Despite the retreat, the bullish bias remains intact, with the price above the SMA and the RSI slightly over 50. Therefore, the retreat might pause and bounce higher after retesting the SMA to continue the uptrend. –Are you interested to learn more about automated trading? Check our detailed guide- If bulls return at the 30-SMA, the price will likely reach the 149.01 resistance level. This would be a higher high, solidifying the bullish bias. https://www.forexcrunch.com/blog/2024/09/03/usd-jpy-outlook-markets-brace-for-us-ism-data/
2024-09-02 11:58
Australian home prices increased in August, continuing the developed uptrend. Investors are pricing a 78% chance of an RBA cut in December. Experts anticipate an improvement in the US labor market in August. The AUD/USD outlook shows bullish sentiment as the Aussie recovers after upbeat Australian housing data. At the same time, the dollar eased from its recent peaks as investors awaited the crucial US nonfarm payrolls report. –Are you interested to learn more about day trading brokers? Check our detailed guide- Data on Monday revealed that Australian home prices increased in August, continuing the developed uptrend. National home prices rose by 0.5% during the month, above the previous month’s increase of 0.3%. The figures pointed to increased demand for housing. Moreover, it reduced the likelihood of a Reserve Bank of Australia rate cut this year. Investors are currently pricing a 78% chance of a cut in December. Meanwhile, policymakers project the first cut coming next year. On the other hand, markets are awaiting a Fed rate cut in September. The only uncertainty is the size of rate cuts. Consequently, the upcoming nonfarm payrolls report will play a significant role in guiding on the magnitude of rate cuts. The previous jobs report indicated a weak labor market that pushed investors to price a 50-bps rate cut. However, in August, experts anticipate an improvement in the labor market. Job growth might increase by 165,000, while the unemployment rate might ease to 4.2%. If this is the case, the Fed will likely implement a 25-bps rate cut. On the other hand, if the labor market shows further deterioration, investors will expect a more aggressive Fed. AUD/USD key events today Market participants do not expect any key reports today. As a result, the pair might consolidate. AUD/USD technical outlook: Bearish pressure below 0.6800 On the technical side, the AUD/USD price is retesting the 30-SMA resistance after a recent breach. The price has traded in a solid bullish trend that failed to go beyond the 0.6800 critical psychological level. Bullish momentum faded, and the RSI showed a bearish divergence with the price. –Are you interested to learn more about automated trading? Check our detailed guide- Bears took control when the price broke the SMA, and the RSI dipped below 50. However, the price must break below the 0.6700 support to make a lower low and confirm a reversal. If it fails to do this, bulls might return stronger to make a new high above the 0.6800 resistance level. https://www.forexcrunch.com/blog/2024/09/02/aud-usd-outlook-aussie-rebounds-on-positive-housing-data/
2024-09-02 09:01
The market focus shifted from inflation to US employment data. US PCE figures revealed an expected 0.2% increase. Eurozone services inflation remained high, lowering bets for ECB rate cuts. The EUR/USD forecast points south. However, the pair recovered slightly as the dollar fell ahead of the all-important US employment report. At the same time, US markets remained closed for a holiday, keeping trading thin. –Are you interested to learn more about day trading brokers? Check our detailed guide- The dollar eased from its two-week peak on Monday as the focus shifted from inflation to US employment data. Last week, the greenback ended Friday up after PCE figures revealed an expected 0.2% increase. After the report, markets lowered the likelihood of a 50-bps rate cut, boosting the dollar. However, the uncertainty about the size of cuts will continue as more data comes in. Investors are particularly anticipating the nonfarm payrolls report, which can significantly alter rate cut expectations. Notably, economists expect increased job growth of 165,000 in July. Meanwhile, the unemployment rate might fall from 4.3% to 4.2%. A positive report will likely boost the dollar by solidifying bets for a smaller rate cut. On the other hand, another downbeat month could raise the chances of a 50-bps rate cut, weighing on the dollar. Meanwhile, the euro strengthened on Monday as investors digested Eurozone inflation data. Initially, the currency fell after German inflation came in softer-than-expected, raising expectations for ECB rate cuts. However, Eurozone inflation later on Friday showed a mixed picture. Headline inflation eased from 2.6% to 2.2%, as expected. However, services inflation remained high, lowering bets for ECB rate cuts. EUR/USD key events today The pair might start the week slowly as there are no key reports. At the same time, trading will remain thin due to a US holiday. EUR/USD technical forecast: Price recovers within downtrend On the technical side, the EUR/USD price is recovering after making a new low below the 1.1100 support level. Nevertheless, bears remain in charge since the price trades below the 30-SMA, with the RSI under 50. –Are you interested to learn more about automated trading? Check our detailed guide- Notably, the trend reversed when the price reached the 1.1201 resistance level. EUR/USD broke below the 30-SMA after a bearish divergence. Afterwards, the price started making lower highs and lows, confirming a new downtrend. Therefore, the price might retest 1.1100 before targeting the next support at 1.1001. https://www.forexcrunch.com/blog/2024/09/02/eur-usd-forecast-dollar-loses-slightly-on-a-silent-day/
2024-08-31 10:55
The Canadian dollar strengthened due to a rally in oil prices. US consumer confidence soared and the economy expanded at a faster-than-expected rate. Canada’s economy showed no expansion, missing expectations for a 0.1% growth. The USD/CAD weekly forecast leans bullish amid economic divergence between Canada and the US. Correcting oil prices could also weigh on the loonie. Ups and downs of USD/CAD The USD/CAD pair fell this week but closed well above its lows. The decline came as the Canadian dollar strengthened due to a rally in oil prices. Oil soared amid increased tensions in the Middle East. –Are you interested to learn more about day trading brokers? Check our detailed guide- However, economic data from the US and Canada supported an uptrend. Notably, US consumer confidence soared, and the economy expanded at a faster-than-expected rate. At the same time, the core PCE price index held steady at 0.2%. These reports supported a strong dollar. On the other hand, Canada’s economy showed no expansion, missing expectations for a 0.1% growth. Consequently, the Canadian dollar eased. Next week’s key events for USD/CAD Next week, the US will release manufacturing PMI and employment data. Similarly, Canada will release its employment report. Additionally, investors will watch the Bank of Canada policy meeting on Wednesday. The employment figures in both countries will shape the outlook for future policy decisions by the Fed and the BoC. Central banks are starting to focus more on growth as inflation nears targets. Therefore, policymakers are keen to see whether demand in the labor sector is falling. Notably, the labor market drives a big part of most economies. Consequently, signs of weakness will pressure central banks to lower borrowing costs. Meanwhile, investors are expecting another rate cut when the BoC meets. USD/CAD weekly technical forecast: Sharp decline pauses with 1.3400 in sight On the technical side, the USD/CAD price has continued its decline below the 1.3600 critical level, indicating a solid bearish bias. The price trades far below the 22-SMA, and the RSI is near the oversold region, showing that bears are in the lead. –Are you interested to learn more about automated trading? Check our detailed guide- However, the decline paused before reaching the next support level at 1.3400. This is a sign that bears are exhausted after such a steep decline. Therefore, they need a short break before continuing lower. A pullback could revisit the 1.3600 level or the 22-SMA. Nevertheless, since the bearish bias is strong, the price might eventually fall to the 1.3400 support level. https://www.forexcrunch.com/blog/2024/08/31/usd-cad-weekly-forecast-weak-economy-weighs-on-cad/
2024-08-31 08:42
The US economy remains resilient despite high interest rates. Data increased the likelihood of a gradual Fed rate-cutting cycle. Inflation in the Eurozone eased from 2.6% to 2.2% moving closer to the central bank’s target. The EUR/USD weekly forecast shows more downside potential, as easing Eurozone inflation points to a more dovish ECB. Ups and downs of EUR/USD The EUR/USD pair had a bearish week, with the dollar strengthening while the euro eased. Data during the week showed that the US economy remains resilient despite high interest rates. Consumer confidence soared, and the economy grew by 3.0%. Meanwhile, inflation held steady at 0.2%. Consequently, this increased the likelihood of a gradual Fed rate-cutting cycle, boosting the dollar. –Are you interested to learn more about day trading brokers? Check our detailed guide- Meanwhile, inflation in the Eurozone eased from 2.6% to 2.2%, moving closer to the central bank’s target. As a result, investors are more confident that the European Central Bank will cut rates again in September. Next week’s key events for EUR/USD Next week, investors will focus on manufacturing business activity data and the monthly employment report from the US. Notably, the manufacturing sector has performed poorly compared to the services sector, remaining in contraction. Economists expect a slight improvement from 46.8 to 47.8. Meanwhile, the nonfarm payrolls report will show the state of the labor market, a key sector in the US economy. The last report showed big cracks as the unemployment rate jumped and job growth slowed. It raised fears of a looming recession and increased Fed rate cut expectations. Another such report could increase expectations for an aggressive Fed rate-cutting cycle, boosting the euro against the dollar. EUR/USD weekly technical forecast: Bulls stall for a brief pullback On the technical side, the EUR/USD price is falling after reaching a new high near the 1.1200 critical level. Nevertheless, it is still in a bullish trend, sitting above the 22-SMA with the RSI above 50. Therefore, although bears have taken over, it might only be temporary. –Are you interested to learn more about automated trading? Check our detailed guide- The price is approaching the 22-SMA support, where it might pause and bounce higher. However, the last time bears retested the SMA, the price punctured the line before reversing. Consequently, this might happen again. If it does, the price might find support at other levels, including the 0.5 Fib, the 1.1001 support, and the bullish trendline. However, if the price breaks below all these levels, it will indicate a new bearish trend. https://www.forexcrunch.com/blog/2024/08/31/eur-usd-weekly-forecast-ecb-dovish-amid-easing-inflation/
