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Further U.S. Dollar Strength Ahead? Waiting For NFP Outcome

Dear Traders,

Bullish exposure seems to be fading ahead of the March U.S. employment report with bears gaining control of the EUR/USD and GBP/USD. However, we are hesitant in our assessment of further dollar strength as we know that payrolls can catch traders on the wrong foot.

While U.S. job growth is expected to have slowed last month, the jobless rate was forecast to have fallen to 4.0 percent amid stronger wage growth. If the latter headline figure meets or even exceeds expectations it might be dollar-positive but traders should be careful. There is plenty of room for a surprise and volatile swings can make today’s trading difficult.

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The NFP Report is due at 12:30 UTC.

GBP/USD

The worst performing currency was the British pound which dropped below its crucial support at 1.40 and extended its slide towards 1.3965. As mentioned in previous analysis, our focus now shifts to a lower target of 1.3880, provided that the pound remains below 1.4050. A break above 1.4060, however, could encourage sterling bulls for a test of 1.41 but it all depends on the outcome of the payrolls.

EUR/USD: The euro dropped below 1.2235 and this pair seems to be heading towards 1.2190 now. A break below 1.2180 could spark bearish momentum towards 1.2150 and possibly even 1.2050 but that remains to be seen. The 1.23-level could act as a short-term resistance.

We wish you good trades and a beautiful weekend!

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Will Payrolls Help Or Hurt The Greenback?

Dear Traders,

It’s payrolls day again and today’s U.S. jobs numbers could matter more than usual as investors assess the possibility of a steeper Federal reserve rate hike path in 2018. While the Fed has established a commitment to gradual monetary policy pacing even under the chairmanship of Mr. Powell, job and wage growth will shape the expectations for 2018 tightening. The central bank is expected to endorse a wait-and-see approach in the first half of the next year after a last rate hike in 2017, which is widely expected to be announced on next week’s Fed meeting.

In short, there is a greater risk of disappointment than an upside surprise when coming to the latest job numbers. If job growth comes in below expectations amid slowing wage growth, the dollar will give up its recent gains. If today’s NFP report surprises to the upside, the dollar will continue to rise amid progress on the tax-cut legislation.

Traders around the world will watch the NFP release at 13:30 UTC.

GBP/USD: The pound rose against the dollar on speculation that Ireland and Britain were close to a Brexit deal. U.K. Prime Minister Theresa May will have time until Sunday to resolve the deadlocked Brexit talks. The GBP/USD jumped back towards 1.3520 after it found support at 1.3320. With the pound trading above 1.3330 we now expect the pair to head for a test of 1.3630/50.

EUR/USD: The euro further declined against the greenback and appears to be headed for a test of the falling trendline of its recent downtrend channel. We anticipate a crucial support area between 1.1740 and 1.1710 and if that threshold remains intact we could see some pullback towards 1.1805 and possibly 1.1850.

We wish you profitable trades for today and a cozy and relaxing winter weekend.

Daily Forex signals:

Additional daily and long-term entries are available for subscribers.

View our daily signal alerts http://www.maimar.co/category/daily-signals/

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

www.maimar.co

 

Pound Comes Under Selling Pressure After May Comments

Dear Traders,

We welcome you to a new trading week. While liquidity returns to the markets, providing a more volatile trading environment, there will be no top-tier economic reports until late in the week. Thus, with no market-moving data scheduled for release until Friday, trading could be quieter and prices more range-bound in the first half of the week.

Those who did a trading break last Friday and did not reinvest weekly profits (as recommended), have not missed out on anything. On the contrary, trading during U.S. payrolls release has once again proved to be more loss-making rather than profitable as high volatile swings bear a high risk for both pending and open orders. The U.S. dollar received a small boost as wage growth rose by 0.4 percent, giving reason for optimism that growth in the U.S. economy is poised to accelerate. While the focus was on wages, monthly payrolls fell short of analysts’ expectations but this decline is not enough to change the Federal Reserve’s hawkish monetary policy stance.

The euro tumbled toward the lower bound of 1.05 and we shall now turn our focus to the 1.0480-level. If the euro falls below that support level we expect further losses towards 1.04 and 1.0370. However, considering that the euro recently traded sideways, we anticipate the price action to be limited to a price range between 1.0640 and 1.0340.

The pound’s price action is dominated by political risk and fears of a so-called hard Brexit.The pound sterling traded lower against the greenback after comments by Prime Minister Theresa May on the U.K.’s European Union negotiations. May signaled regaining control of immigration and lawmaking are her Brexit priorities even if that means quitting Europe’s single market. Bearish momentum accelerated this morning, pushing the pound below its crucial support at 1.22. If the currency pair is unable to stabilize above 1.22, we expect further losses towards 1.2120 and 1.21. Looking at the technical picture we see that the descending trend line of the recent downward channel is currently at 1.2120, providing an attractive opportunity to buy sterling towards 1.22. A short-term resistance is however seen at 1.2270.

Apart from a busy docket of scheduled speeches from several central bank officials, the only interesting piece of economic data will be U.S. Retail Sales and Consumer Confidence on Friday.

Daily Forex signals:

Additional daily and long-term entries are available for subscribers.

View our daily signal alerts http://www.maimar.co/category/daily-signals/

Subscribe to our daily signal service http://www.maimar.co/signals/

We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

www.maimar.co