Top trade setups in forex – Who's up for US nonfarm payroll?

The U.S. stocks ended a choppy trading session with 2% gains, as energy stocks surged along with oil prices after President Donald Trump suggested two major oil producers Saudi Arabia and Russia could agree on major output cuts. The Dow Jones Industrial Average rebounded 469 points (+2.2%) to 21,413, the S&P 500 jumped 56 points (+2.3%) to 2,526, and the Nasdaq 100 was up 149 points (+2.0%) to 7,635.

Regarding U.S. economic data, the Labor Department reported that Initial Jobless Claims doubled in one week to a record 6.648 million in the week ended March 28 (3.500 million expected).

XAU/USD - Market Awaits U.S. NFP

The precious metal gold safe-haven-metal prices flashing red and dropped to $1,625 level despite the downbeat unemployment claims data from the U.S. Gold prices earlier failed to extend its gains as Asian stock markets opened with gains on the back of rising oil prices. After the early-day declines, the gold prices still trading above the $1,610 handles. At the press time, the gold is trading at 1,627.75 and consolidates in the range between the 1,625.20 - 1,640.50.

At the data front, the rise of 6.648 million in the U.S. Initial Jobless Claims failed to stop the dollar rally, as the total number of virus cases globally crossed 1 million, with over 50,000 deaths reported so far, which further fueled the risk-off market sentiment. The U.S. dollar index now trades at 100.25, having reached a multi-day high at 100.40.

As per the latest report, the coronavirus cases rose to 1,016,568

so far, whereas there was a 24% rise in the death toll to 2,921 at the same time. Meanwhile, the Washington Governor extended the stay-at-home order, whereas S&P declared its U.S. rating at AA+ with expectations of a recovery in 2021.

Later today, eyes will be on the U.S. Labor Department, which is due to release March nonfarm payrolls report (-100,000 jobs, jobless rate at 3.8% expected). The Institute for Supply Management will post its Non-manufacturing Index for March (43.0 expected).

XAU/USD - Daily Technical Levels

XAU/USD - Daily Trade Sentiment

Gold is trading choppy in a narrow treading range of 1,617 - 1,608, where the general trading sentiment remains bullish. Looking at the 4-hour chart, gold is facing a crucial resistance at 1,617, which is prolonged by the double top and declining trendline pattern.

On Friday, the main focus will linger on the Nonfarm payroll, and the release of this information will help define new trends in gold. Weaker NFP (which is highly anticipated) can trigger an upward breakout and drive gold prices towards the next target level of 1,633 and 1,642. Conversely, a bearish breakout can lead to gold below to 1,594 zones. Let's have a thicker sight on the U.S. NFP today.

USD/CAD - Boosted Oil Prices Supports Loonie

The USD/CAD was flashing green and rose to a fresh high of 1.4300, mainly due to the fresh sharp drop came at the oil prices. The broad-based U.S. dollar strength also boosted the currency pair as the oil prices jumped almost 25% in the last session before dropping, which increased the demand for the loonie earlier.

At the moment, the USD/CAD is currently trading at 1.4188 and consolidates in the range between the 1.4115 - 1.4198. However, with the oil rally losing its gains and the greenback defeating its rivals and rose to the highest level as in result, the pair erased its losses and was last seen trading at 1.4210, up 0.15% daily.

Besides, the U.S. President Trump said on Thursday that he spoke to Saudi Arabia's Crown Prince and Russian President Putin and added that he was expecting an oil output reduction of about 10 million barrels. Although the barrel of West Texas Intermediate (WTI) spiked above $27 with the initial reaction, lack of an official announcement forced the WTI to erase a portion of its gains.

It is worth mentioning that there was no set time for an emergency meeting between OPEC and non-OPEC producers so far, and a senior Trump administration official noted that the U.S. did not know the former details of oil output cuts.

USD/CAD - Daily Technical Levels

USD/CAD - Daily Trade Sentiment

The USD/CAD is consolidating in a sideways range of 1.4245 - 1.4080. On the 4 hour chart, the USD/CAD has formed a descending triangle pattern, which is likely to support the commodity currency pair at 1.3990. On the upper side, the descending trendline may extend resistance around 1.4220.

Typically, the breakout of the descending triangle on the lower side, and if this happens, we may see USD/CAD prices heading further lower towards the next support area of 1.3735. Conversely, a bullish breakout of 1.4200 level can lead the USD/CAD prices further higher towards 1.4270. Today, let's look for buying traders over 1.4170 and bearish trades below the same.

AUD/USD – Lowers Low Pattern In-Play

The AUD/USD failed to hold its gains and dropped to 0.6028, mainly due to broad-based U.S. dollar strength. The weak equity market weighing on the Australian dollar and sent the pair lower. The U.S. continued to gain support from the intensifying coronavirus crisis and capped the upside movement of the AUD/USD pair.

Currently, the AUD/USD pair is trading at 0.6038 and consolidates in the range between the 0.6028 - 0.6076. The AUD/USD seems to find some support near 0.60 psychological marks on Friday, as several cases in China have dropped while the U.S. economy is suffering badly.

Besides, better-than-expected-China services PMI also gave a modest boost to the Australian dollar earlier, but the multiple negative factors kept a lid on the decisive move. At the USD front, the U.S. dollar hit the highest levels in 6-days against its 6-major rivals and continues to rise. It looks like the U.S. dollar's safe-haven demand continues to increase due to intensifying coronavirus outbreak and its growing risks on the global economy.

For now, the release of worse than expected U.S. nonfarm payroll figures are likely to weigh on the U.S. dollar and may underpin the AUD/USD pair. While the technical side is suggesting in contrast, let's take a look.

AUD/USD - Technical Levels

AUD/USD - Daily Trade Sentiment

On Friday, the AUD/USD has dropped below 0.6025 support level, and it seems to have violated the choppy range of 0.6205 - 0.6025. Despite the closing of a 4-hour candle below 0.6025, it will be better to wait for the market to violated the psychological support level of 0.6000. Closing of 4-hour candle below this level will confirm the breakout, and it may lead the AUD/USD prices until the next target level of 0.5875.

The 50 periods exponential moving average (EMA) and the RSI are still holding below 50, supporting the selling bias among traders. So let's consider staying bearish below 0.6045 level today to target 0.5950 and 0.5925.

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