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MTrading Team • 2024-03-08

GBPUSD seesaws near yearly top amid mixed signals ahead of US employment data

GBPUSD seesaws near yearly top amid mixed signals ahead of US employment data

The risk complex remains unclear early Friday as the market’s previous optimism about the Federal Reserve (Fed) rate cuts fade ahead of the US employment report for February. With this, the US Dollar Index (DXY) prods a five-day losing streak as the six-week low, challenging the previous run-ups of commodities and Antipodeans.

That said, EURUSD initially rose to the highest level since mid-January before retreating to 1.0950 by the press time. Further, GBPUSD lacks buying momentum and hence pokes the Cable buyers at the highest level in 2024.

It’s worth noting that the top-tier bond yields remain pressured and hence join the hawkish Bank of Japan (BoJ) concerns to exert downside pressure on the USDJPY prices. Additionally, USDCAD also stays pressured for the third consecutive day, at the lowest level in a fortnight.

Gold price remains sidelined after refreshing the record top the previous day whereas crude oil prints a three-day uptrend amid fears of supply crunch.

Elsewhere, BTCUSD also rises for the third consecutive day while reversing the early-week pullback from the record high while ETHUSD renews the multi-year peak surrounding $3,935.

Following are the latest moves of the key assets:

  • Brent oil rises for the third consecutive day as buyers attack $84.00 by the press time.
  • Gold price seesaws at the highest level on record, making rounds to $2,160-55 of late.
  • USD Index hovers at the lowest level in six weeks, snapping a five-day losing streak near 102.85 at the latest.
  • Wall Street closed with minor gains while the Asia-Pacific stocks edged higher. Further, the shares in Europe and the UK remain indecisive during the initial hour.
  • BTCUSD and ETHUSD both print mild gains around $67,500 and $3,920 while approaching the multi-year highs.
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US Dollar prints corrective bounce ahead of US employment report…

Market players consolidate the weekly moves with eyes on the US and Canadian jobs report for February. Most of the Federal Reserve (Fed) officials including Chairman Jerome Powell reiterated support for the June rate cut kept the US Dollar down the previous day. Also weighing on the US Dollar could be the recent soft signals from the US data surrounding employment, wages and price. Furthermore, optimism in Asia, downbeat yields and central bank buying are extra catalysts favoring the USD bears.

However, an early-day speech from US President Joe Biden spread optimism among US watchers as the national leader praised employment and inflation conditions while advocating for the soft landing. The same joined the anxiety ahead of the US jobs report for February, encompassing the headlines Nonfarm Payrolls (NFP), Unemployment Rate and Average Hourly Earnings. 

It should be noted the Bank of England (BoE) survey showing sturdy inflation in 2024 allows GBPUSD to battle with the US Dollar’s rebound whereas the Fed’s report showing hardships for small businesses tests the Greenback buyers before the key data. Meanwhile, the ECB’s hawkish halt allowed EURUSD to refresh a multi-day high before retreating whereas USDJPY traders reassess BoJ concerns and yields to keep the sellers on the board despite recent inaction.

Gold Price remains dicey as traders seek more clues to defend the run-up toward refreshing the record top while chatters about the Middle East tensions and the OPEC+ group’s readiness to extend supply cuts allow Oil prices to extend the mid-week recovery.

On a different page, Crypto traders appear more optimistic amid the institutionalization of the funds into the BTCUSD and ETHUSD due to the spot ETF approvals.

  • Strong buy: USDCAD, USDJPY
  • Strong sell: Crude Oil, US Dollar, GBPUSD
  • Buy: BTCUSD, ETHUSD, Nasdaq, Gold

All eyes on NFP…

Although the Canadian jobs report and the UK NIESR GDP Estimate will entertain the market players, major attention will be given to the US employment numbers for February as traders make peace with the Fed’s June rate cut and weigh on the US Dollar. Hence, softer prints of the US employment data could keep the greenback pressured and help the commodities, as well as other major currencies and Antipodeans, to extend the latest run-ups.

May the trading luck be with you!