Forex Today: Jackson Hole and US jobs in the limelight

Pablo Piovano FXStreet

The US Dollar (USD) has navigated an inconclusive range on Thursday, struggling to build on the previous day’s gains and briefly reaching multi-day peaks. In the meantime, geopolitical tensions have been simmering on the back burner, while investors have geared up for Friday’s US Nonfarm Payrolls revision and the speech by Fed's Warsh at Jackson Hole.

Here is what you need to know on Friday, August 28:

The US Dollar Index (DXY) has managed to maintain the weekly recovery in place, looking to extend the recent breakout above the 99.00 hurdle. The better tone in US Treasury yields and steady geopolitical uncertainty have also bolstered the uptick. Next on tap on the US docket will be the release of the Nonfarm Payrolls Annual Revision, the final U-Mich Consumer Sentiment gauge and the speech by Chair Warsh at the Jackson Hole Symposium.

EUR/USD has extended its weekly downtrend, at some point flirting with its key 200-day SMA, although it managed to attempt some recovery past 1.1650 afterward. Closer to home, Germany’s labour market report should gather all the attention alongside the final prints of the Consumer Confidence in Euroland and the speech by the ECB’s Schnabel.

GBP/USD has slipped back to fresh multi-day lows, challenging 1.3570 prior to recovering ground and reclaiming the 1.3600 region. The next event across the Channel will be the release of the Nationwide Housing Prices.

USD/JPY further extended its weekly recovery, up for the fourth day in a row and revisiting the 159.50 zone. The Unemployment Rate, Consumer Confidence, Housing Starts, Construction Orders and inflation figures in Tokyo will be on top of the agenda in the 'Land of the Rising Sun.'

AUD/USD has remained well bid and approached 0.7200, the figure to challenge three-month highs. Data-wise in Oz, quarterly Business Inventories figures, Housing Credit and Private Sector Credit data are next on tap on August 31.

Prices of WTI added to Wednesday’s recovery and surpassed the $83.00 mark per barrel, always closely following developments surrounding the Middle East crisis.

Gold has built on Wednesday’s losses, trading closer to the $4,560 mark per troy ounce, or four-day lows. The precious metal’s decline has followed the US Dollar’s vacillating price action, higher US Treasury yields and steady caution pre-Jackson Hole event.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Week ahead: US CPI, France’s budget crisis and Q3 earnings to set the market tone

The US dollar held relatively strong this week, despite the disappointing US jobs report on October 2, which further decreased the probability of a back-to-back rate hike by the Fed at the upcoming gathering on October 28.

CFTC Report: Euro and Aussie shorts expand amid diverging signals

The week in one sentence: Euro and Australian Dollar shorts deepened in the week to October 6, while Yen longs rebuilt. In addition, Coffee buying continued, and Gold exposure remained elevated despite another price decline. Speculators turned more negative on the Euro, increasing the net exposure to around 99.3K contracts.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?