Daily Forex Market Preview, 06/04/2018
The U.S. dollar was seen trading stronger on the day as economic data from the Eurozone and the UK disappointed. The equity markets pushed higher on improving market sentiment as investors took a break from the uncertainty from the trade wars.
In the UK, the services sector PMI data came out weaker as the index fell to 51.7 missing estimates of 53.9 and down from February’s print of 54.5. The British pound slipped on the news as the services PMI wrapped up a weak month of March. Previously, manufacturing PMI was weaker alongside construction PMI which showed a contraction in the sector.
In the Eurozone, retail sales data showed a 0.1% increase on the month which was below estimates of a 0.6% increase. Previous month’s data was also revised down to show a 0.3% decline. The services PMI data from the Eurozone was seen at 54.0 which was slower than February’s print of 54.2
Looking ahead, the economic data today will focus on the payrolls report for March. Following a stronger than expected print from the ADP data earlier this week, economists forecast that payrolls rose 188k on the month. The U.S. unemployment rate is expected to slip to 4.0% marking a new low in recent years while wage growth is forecast to rise 0.3% on the month.
XAUUSD 06-04-2018 Intra-day analysis
XAUUSD (1330.29): The decline in gold prices stalled around the 1328 handle with price posting a strong rebound. Gold prices could remain caught within the range as resistance at 1336 is likely to keep a lid on any gains to the upside. There is a high possibility that gold prices will breakout to the downside in the near term as we expect to see gold prices extending the decline to 1307. To the upside, price action will need to clear the 1336 level to establish further gains to the upside.