Trade Setups in Forex, Buckle Up for ADP Payroll Figures!
|On Thursday, the global financial markets are trading the risk-on sentiment, which has triggered a reversal in the safe-haven asses such as Gold, Japanese yen and Swiss Franc.
Lately, the U.S. Commerce Department imposed up to 141% tariffs on Chinese structural steel and up to 31% on Mexican structural steel, as it was found out that China and Mexico had dropped several fabricated structural steel classes on the U.S market.
However, gold's upward run showed little hints of curbing down as the U.S Treasury yields extended its fall to a three-year low directing investors to look for safe-havens.
On the fundamental side, the U.S. economic calendar is due to release ISM Non-manufacturing PMI figures along with ADP nonfarm payroll data which is used to predict the actually nonfarm payroll data due on Friday.
EUR/USD - Recovers Sharply, Weaker Dollar Plays
On Thursday, the single currency Euro continues to recover sharply against the U.S. dollar to trade at 1.1056. New purchase orders lodged with manufacturers in Germany sank distinctly in July. Destatis recorded a drop of 2.7%, which was significantly beneath the analyst rating for a decline of 1.5% in orders.
The data validate ongoing instability in the manufacturing sector.
Earlier in the week, manufacturing PMI reports for both the Euro area and Germany revealed something comparable. The PMI data reveals a poll of managers to evaluate whether the industry is shrinking or expanding. In both scenarios, the data exhibited a contraction, although this was in line with analyst forecast.
Later today, the ADP will publish the US jobs report. Therefore we will get a preliminary view of the performance of the US labor markets during August. On Friday, the Non-Farm Payrolls figures will be published, so we should stay alert as it tends to have a higher impact on the markets.
EUR/USD - Daily Technical Analysis
On the technical side, the EUR/USD is trading strongly bullish at 1.1050 area. It has already violated the bearish channel at 1.09. The major pair was seen testing a major resistance area of around 1.1020, but the weaker dollar and strengthening Euro has triggered a bullish crossover on the 50 periods EMA. The return from here is likely to explain the trend for the pair.
On the 4 hour timeframe, the EUR/USD may find resistance at 1.1060, and the next resistance is likely to be found around 1.1090, extended by the bearish trendline.
EUR/USD - Daily Technical Levels
Support Resistance
1.0908 1.1109
1.0835 1.1238
1.0633 1.1439
Pivot Point 1.1036
EUR/USD - Daily Trade Sentiment
The U.S. session is likely to bring us further buying until 1.1090 area, and below this, I will be looking to take a sell trade with a target of 1.1040.
GBP/USD - Bullish Power Dominates Ahead of U.S. Session
On Thursday during the Asian and early European session, the British Pound mounted to a one-week high after lawmakers voted to push Prime Minister Johnson to attempt a three-month delay to Brexit if he disappointed to defend a transition agreement with the European Union.
Political risk prevailed high — Johnson replicated his efforts to endeavor an election following month after an initial effort was defeated on Wednesday. However, the Sterling gained strong bullish momentum as investors felt consoled that at least a no-deal Brexit appeared to be averted.
GBP/USD - Daily Technical Analysis
The GBP/USD pair swiftly reversed an initial European session dip to the 1.2200. As you can see on the chart, the GBP/USD has already violated the bearish trendline which was extending it a strong resistance at 1.2250.
Besides the cable has also violated the double top resistance area at 1.2300 which is opening further room for buying until 1.2400.
GBP/USD - Technical Levels
Support Resistance
1.2141 1.2306
1.2036 1.2366
1.1871 1.253
Pivot Point 1.2201
GBP/USD - Daily Trade Sentiment
Ahead of ADP Non-farm report, the GBP/USD is likely to exhibit bullish trend until 1.2360 and continuation of this can extend buying until 1.2400. I will be looking to take a sell position below this level.
Gold - XAU/USD - Tests Bullish Trendline Support
On Thursday, the precious metal gold traded sideways around 1,544 as investors awaited the release of U.S. ISM non-manufacturing and ADP Non-farm payroll data which typically drives nice movement in the market.
In the international markets, gold prices continue to surge amid a safe-haven appeal. As per the recent updates, the retail price of physical gold in Japan soared to its highest in almost 40 years on Thursday. A surge strengthened by variations in the value of the yen but following a global quest for the safe-haven precious metal amid worries that the U.S.-China trade row could further depress the global economy.
Safe-haven metal prices continue to remain unchanged and fluctuate near the $1542 with the lack of fresh political and trade catalysts during the European session. Let's wait for the opening of the U.S. session for some serious action in gold.
Gold - XAU/USD - Daily Technical Analysis
The precious metal gold is trading in the bullish channel, which is likely to support the metal at 1,540 today. Right below this, gold is likely to find support around 1,530. Gold has entered into the fresh trading range of 1540 - 1560.
Both of the leading indicators RSI and MACD are holding in a neutral to the bullish range, still suggesting bullish bias among traders. The 50 periods EMA is supporting the precious metal above 1537.
Gold - XAU/USD - Daily Technical Levels
Support Resistance
1538.3 1561.55
1524.5 1571
1501.25 1594.25
Pivot Point 1547.75
XAU/USD -Daily Trade Sentiment
Trade sentiment is to stay bullish above 1,533/32 and bearish below 1,547 during the U.S. session, until and unless ADP reports some surprising variation in private jobs.
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