Will Payrolls Reignite The Dollar’s Strength?
Good morning traders, it’s payrolls day again.
The U.S. jobs report will shape expectations about when the Federal Reserve might start tapering its stimulus and when to expect a rate hike. Since this is a highly awaited event risk, we will prepare for bigger moves amid possibly extreme volatility.
We saw the U.S. dollar holding a drop ahead of today’s report and going into the release, the greater impact seems to come from a stronger reading that spurs bullish momentum in the dollar. Should the reading disappoint the forecast for a 750,000 jobs increase, the greenback will further depreciate.
Looking at the EUR/USD, however, even in case of a weaker payrolls number, the rise of the euro might be limited as the pair remains overbought with a correction overdue.
The GBP/USD broke above 1.3830 and next targets could be at 1.3860 and 1.3880 but it’s the same situation as the EUR/USD: Both pairs look overbought and thus, chances are in favor of a greater impact for USD strength in case of an upbeat NFP report.
We wish everyone good trades and a beautiful weekend.
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Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.
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