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Summary
We’ve had quite a bit of volatility in the EUR and JPY crosses in the past few days, post French Elections and ahead of the ECB and BOJ rate decisions today. The EURJPY pair tested and confirmed above the daily Ichimoku cloud in the past few days, however with the important economic events today, we are still on wait and see mode. If the ECB’s Draghi hints at possible shifts in policies and forward guidance in June, then we might see the euro extend its rallies this week. But if he claims inflation is still too low, and fails to hint at tapering or tightening in the near-term, then we might see a bit of profit-taking across the major euro pairs. Also on the economic calendar today is the US Durable Goods Orders out 12:30 PM. Japan will have yet another event during the next day’s Asian session at 11:30 PM GMT, to release their National Consumer Price Index. Thanks for watching and I wish you the best of luck making pips by trading forex.
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EUR/USD holds firm above 1.1900 as US NFP looms
EUR/USD holds its upbeat momentum above 1.1900 in the European trading hours on Wednesday, helped by a broadly weaker US Dollar. Markets could turn cautious later in the day as the delayed US employment report for January will takes center stage.
USD/JPY remains heavy around 153.00 on firmer Japanese Yen
USD/JPY is sustaining its three-day rout at around 153.00 in the European session on Wednesday, awaiting the closely-watched US NFP report. Rising bets on Fed rate cuts keep the US Dollar depressed. In contrast, expectations that PM Takaichi's policies will boost the economy and allow the BoJ to stick to its hawkish stance bolster the Japanese Yen, weighing on the pair amid intervention fears.
Gold sticks to gains near $5,050 as focus shifts to US NFP
Gold holds moderate gains near the $5,050 level in the European session on Wednesday, reversing a part of the previous day's modest losses amid dovish US Federal Reserve-inspired US Dollar weakness. This, in turn, is seen as a key factor acting as a tailwind for the non-yielding yellow metal ahead of the critical US NFP release.
US Nonfarm Payrolls expected to show modest job gains in January
The United States Bureau of Labor Statistics will release the delayed Nonfarm Payrolls data for January on Wednesday at 13:30 GMT. Investors expect NFP to rise by 70K following the 50K increase recorded in December.
S&P 500 at 7,000 is a valuation test, not a liquidity problem
The rebound from last week’s drawdown never quite shook the sense that it was being supported by borrowed conviction. The S&P 500 once again tested near the 7,000 level (6,986 as the high watermark) and failed, despite a macro backdrop that would normally be interpreted as supportive of risk.
Nonfarm Payrolls Live Coverage:
Will NFP data for January reshape Fed rate cut expectations?
Investors expect NFP to rise by 70K following the 50K increase recorded in December. The Unemployment Rate is expected to remain unchanged. Our experts will analyze the market reaction today at 13:00 GMT.