The Forex Market Wrap is here!
Watch the video to learn what key levels have been hit this week!
Forex Market Wrap Analysis
This week investors were focused on the data out of the US as the Federal Reserve Chairman was expected to announce a change to monetary policy. In his speech the Federal Reserve Chairman did confirm that the Fed will slow the pace of tightening but still outlined that inflation was a problem. This means they will act aggressively again if the inflation numbers do not decline. The Federal Reserve’s fear was overtightening however using this approach they can allow the data to catch up.
The NFP numbers were expected to show a decline this week but that was not to be. The numbers were meant to show a drop from 280k to 200k but instead jobs came in above 260k. This was also met with a rise in the average hourly wages from 0.5% to 0.6%.
This week we expected the USD weakness to continue which was confirmed by the reaction from the Federal Reserve Chairman Powell’s speech. Our outlook wanted to see the EURUSD price reach the 1.0500 level now the price is here we could see some resistance form. The USD could weaken further and if it does the price will likely trade back through the 1.0500 level.
The price of cable rallied as expected this week and is currently trading above the 1.2200 handle. The price is also technically working within a bullish channel, and price has reached the high of the channel which could offer traders opportunity to close out longs. If this sees the price reach the low of the channel this could be a level where buyers step back in.
The strength meter this week brought attention to the NZDUSD pair as the NZD was the strongest currency and the USD was the weakest currency. In the week ahead analysis we pointed out the highs of 0.6150 as a level of support for opportunities long. Price has since moved over 200 pips from this level heading towards the resistance at 0.6450.
The price of Gold has benefited this week from the USD weakness and the slowing pace of rate hikes to come. The price rallied into the $1800.00 level before turning on the NFP numbers. If the price is going to continue higher the next level of interest would be $1875.00. This would require the USD to weaken further which looks likely if this week is anything to go by.
Did you see our NZDUSD Analysis? You can see it here.
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