NFP day dawns, promising plenty of excitement in FX markets.
GBP/USD bears bitten by spikeSterling bears will be licking their wounds today after yesterday’s spike. We have seen the price drift back from $1.33, which marked the limit of cable’s advance. A break through here would head towards $1.3370, the high from the beginning of August.
Any strength in the dollar following non-farm payrolls today could see some of the gains unwound, with initial support around the 50-hour simple moving average (SMA) at $1.3197, and then down to the lows of the week around $1.3050.
EUR/USD bounces into ceilingThe pair bounced yesterday and hit a ceiling at $1.12, providing, it seems, another selling opportunity.
Further downward progress would head towards the lows of the week around $1.1125, and through here the next target would be the early August low at $1.1069.
Any rally through the 200-hour SMA ($1.1225) might start to put a dent in the bearish outlook, with $1.13 as longer-term resistance.
USD/JPY tests 2016 downtrendThe 2016 downtrend is being tested once again, with USD/JPY trying to succeed where yesterday’s rally to ¥104 failed. If it does push through ¥104, then the next target would be ¥106.
So long as daily stochastics remain in a bullish trend, with the hourly moving averages all moving higher, then the instinct heading into next week will be to buy dips as they appear.
