Forex Week Ahead Analysis: 6th May

📈💼 Stay ahead of the Forex game! Dive into our analysis of the week ahead in global currencies. From the USD’s ups and downs to potential moves from the RBA and BoE, we’ve got you covered. #ForexAnalysis #MarketInsights #StayInformed

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Forex Week Ahead Analysis

Last week saw the USD on a downward trajectory due to a string of disappointing data releases. Notably, the Non-Farm Payrolls data fell below 200k for the first time this year, prompting speculation about future rate cuts. Federal Reserve Chairman Powell’s remarks on Wednesday reinforced the notion that rates would remain higher until inflation steadied within the 2% target range. With this sentiment now factored into the market, focus shifts squarely onto the labor market’s performance, which could play a pivotal role in taming inflation.

Throughout the week, attention will be drawn to speeches from FOMC members, given the recent data. While the US data calendar remains relatively light until later in the week, eyes will be on Australia and the United Kingdom.

In Australia, the RBA is expected to maintain interest rates at 4.35%. However, recent upticks in consumer and producer inflation figures have sparked discussions about a potential hike. Investors will closely monitor the subsequent press conference for insights into future monetary policy.

Meanwhile, the Bank of England is anticipated to keep interest rates steady at 5.25% on Thursday. The slight uptick in UK CPI year-on-year to 3.2% could be a focal point for the BoE’s discussion on future monetary policy. Many central banks, including the BoE, are awaiting inflation rates to align closer to the 2% target before considering any policy adjustments.

USD Index

The price on the chart has traded through multiple technical levels and some observations included:

• The price of the USD Index closed above the previous highs of $105.00. However if the USD breaks this level, the next support is at $103.00.
• If USD buyers re-enter the market the price could still target the $107.00 resistance level. 

EURUSD

The price on the chart has traded through multiple technical levels and some observations included:

• The price of the EURUSD is still in a downward trend on the higher time frame (W1). 
• The H4 time frame remains in an upward trend and this would need to change before agreeing with the higher time frame bias. 
• If price remains above 1.0750 market participants may favor higher prices.

GBPUSD

The price on the chart has traded through multiple technical levels and some observations included:

• GBPUSD closed below the resistance of 1.2600, this could sway price towards the short side.
• However if the price fails to close below the current H4 lows, we could see price continue to remain bullish this week.

USDCHF

The price on the chart has traded through multiple technical levels and some observations included:

• The price of the USDCHF found resistance at the key highs of 0.9200.
• Now the price is trading below previous support of 0.9100, we could see this level being used as resistance. 

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About The Author

Jonathan Kibbler

Jon Kibbler, our Senior Market Analyst, boasts over a decade of trading experience. He specializes in dissecting the intricacies of financial markets and sharing his expertise with precision. Jon’s insights have been featured at renowned events and platforms like Coindex, Forex Analytix, and Forex.com.

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