Daily Forex Market Preview, 05/02/2018
The U.S. dollar managed to close on Friday with some gains, led by a better than expected payrolls report. Data showed that as the U.S. unemployment rate held steady at 4.1% for the fourth consecutive month, wage growth was better than expected. Previous month’s revisions to wage growth put the annual gain to 2.9%.
Looking ahead, the economic calendar today will see the release of the UK’s services PMI data. Forecast shows that activity in the sector remained stable, easing to 54.1 for January which is down from 54.2 in December. Data from the U.S. will see the release of the ISM’s non-manufacturing PMI data.
The median estimates point to a modest increase to 56.5 for January, up from December’s 55.9. Markit’s services PMI data will also be released for the U.S. Later in the day, ECB President Mario Draghi is expected to speak.
USDJPY intra-day analysis
USDJPY (109.93): The USDJPY posted strong gains on Friday with the U.S. dollar strengthening sharply against the yen. Price action remains trading below the resistance level at 110.70 level in the near term. Unless USDJPY breaks out from this level we can expect USDJPY to trading sideways. From the 4-hour chart, price reached the short term resistance level at 110.44 – 110.34 level. A reversal off this level could see price dipping back to 109.60 level marking a retest of the breakout from the median line. A rebound off this level could suggest further upside in price subject to price breaking out from the resistance level.