Traders Gear Up For Payrolls Report

Intraday Technical Analysis 03 May

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A busy day for traders today will see some high ticket events. The official payrolls report for April will be coming out. Economists forecast an increase of 181k jobs during the month with the US unemployment rate holding steady at 3.8%.

Average hourly earnings are forecast to more than double from the month before. Later in the day, the ISM’s non-manufacturing PMI will be coming out followed by speeches from various Fed members.

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Euro Trades Soft Against the USD

The US dollar was maintaining its bullish momentum a day after the Fed meeting. This came as investors digested the FOMC meeting. The dollar gains came as the Fed was seen to be less dovish than expected, calling the current weakness in inflation transitory. Meanwhile, factory orders rose 1.9%. In the eurozone, the final manufacturing PMI rose only modestly to 47.9.

Can the EURUSD Extend Declines Lower?

The common currency ‘s rebound off the lows near 1.1140 saw price rallying. But, failure to build upon the momentum sent it lower just a day later. EURUSD is trading back within the range. The downside support at 1.1140 is likely to be tested in the near term. A rebound off this region could keep the currency pair supported, but further gains above 1.1226 are hard to come by.

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Oil Slips 3.2% on Fears of Inventory Build Up

Crude oil prices posted sharp declines on Thursday as the price of WTI crude oil settled at 61.56. The declines in oil prices come as at the EIA’s weekly inventory report showed an increase in inventories. The declines marked a one-month low in oil. Volatility in the oil prices could continue as Iran’s sanctions on oil exports get underway.

Can Oil Recover from the Declines?

Oil prices could potentially rebound off the current lows. The recently breached support level at 62.85 could see price retesting this level. Establishing resistance here could signal a potential downside move. However, with the bearish momentum currently, oil prices could continue to extend declines. The downside could stall near the support region of 60.33.

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Gold Steadies Near the 200-day Moving Average

The precious metal fell 0.56% on the day on Thursday. However, by the session’s close, gold prices pulled back, consolidating near the 200-day moving average. The rebound in gold prices comes amid reports that the US and China trade talks could hit some obstacles. However, traders are holding back ahead of the payrolls report due later today.

Can XAUUSD Correct Higher?

At the time of writing, XAUUSD is attempting to recover the losses from Thursday. Price action is back to retest the 1272 level. If the resistance level holds we expect to see the downtrend continue. Alternatively, if gold manages to close above the 1272 handle, price action could remain range bound. A daily close, relative to the 1272 region will key in the near term.

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