Daily Forex Market Preview, 05/07/2018
Economic data was light on the day especially with the U.S. markets closed yesterday. Australia’s retail sales report showed a 0.4% increase on the month beating estimates of a 0.3% increase with the previous month’s data being revised higher to 0.5%.
In the UK, the services PMI showed that activity in the sector increased strongly, rising to 55.1, beating estimates of 54.0 and rising from May’s level of 54.0.
The markets will be looking to a busy day especially where the U.S. dollar is concerned. The ADP private payrolls report is expected to show that the U.S. economy added 190k jobs in the private sector. This marks a higher pace of job growth compared to May’s increase of 178k.
The ISM non-manufacturing PMI is forecast to slip to 58.3 in June compared to 58.6 in May. However, there is scope that the actual data could surprise to the upside.
Later in the evening, the FOMC meeting minutes will be released. The minutes cover the June FOMC meeting where interest rates were hiked and the Federal Reserve had announced a fourth rate hike for the year.
EURUSD intra-day analysis
EURUSD (1.1662): The EURUSD currency pair was seen posting a doji pattern on the daily chart. Price action continues to remain trading subdued within the range established from last Friday. The strong consolidation is likely to result in a breakout from the range. To the upside, the resistance at 1.1730 is likely to keep a lid on the price action while to the downside, a break down below 1.1610 could trigger a dip back to the previous lows at 1.1540.
USDJPY intra-day analysis
USDJPY (110.33): The USDJPY currency pair managed to post a modest retracement back to 110.62 before easing back. The currency pair is likely to extend the declines with the support at 109.57 – 109.43 likely to be tested. Alternately, in the event of a reversal before reaching the support, the USDJPY currency pair could be seen rising back to the 110.62 level with the possibility to breakout higher. This could ensure further gains in store in the currency pair.
XAUUSD intra-day analysis
XAUUSD (1256.13): Gold prices continued to inch higher as price action is seen approaching the resistance level at 1263 level. A reversal off this level could trigger a possible rebound in price action. This could keep gold prices maintaining the sideways range within 1263 resistance and 1247 support. A breakout from either of these levels could establish the new short-term direction in prices.