2024-10-30 07:59

Inflation in Australia eased to an over 3-year low in the third quarter. RBA rate cut bets fell to reflect a 24% likelihood of a cut in December. US consumer confidence rose more than expected. The AUD/USD price analysis supports a downtrend as easing price pressures in Australia put downward pressure on the Aussie. However, market participants pushed back bets for a rate cut due to high core and services inflation. Meanwhile, the dollar remained steady after a mixed bag of economic figures. Inflation in Australia eased to an over 3-year low in the third quarter mainly due to government subsidies on electricity. The CPI increased by 0.2%, missing forecasts of a 0.3% increase. This caused an initial drop in the Australian dollar. However, when traders had time to digest the report, it became clear that the main figures showed still-high inflation. Notably, the core CPI increased by 0.8%, above forecasts of 0.7%. Meanwhile, services inflation rose by 4.6% after a 4.5% increase in the previous quarter. The Reserve Bank of Australia pays close attention to these numbers. Therefore, policymakers might remain cautious about rate cuts. Meanwhile, market bets fell to reflect a 24% likelihood of a cut in December and a 44% chance of a cut in February next year. Market participants are only fully pricing the first move in April. On the other hand, the dollar remained firm after data revealed that consumer confidence rose more than expected. The CB consumer confidence rose to 108.7, well above estimates of 99.5. However, a separate report showed that job vacancies in the US fell to 7.44 million, missing forecasts of 7.98 million. The drop indicated a drop in demand for labor that solidified bets for a Fed rate cut in November. AUD/USD key events today US ADP nonfarm employment change US advance GDP q/q AUD/USD technical price analysis: Downtrend eyes 0.6501 support level On the technical side, the AUD/USD price is on a solid downtrend, with the price below the 30-SMA and the RSI near the oversold region. The price recently broke below the 0.6600 support level to make new lows in the downtrend. –Are you interested to learn more about forex signals? Check our detailed guide- Given the solid bearish bias, AUD/USD might soon reach the 0.6501 support level. Moreover, the downtrend will continue as long as the price stays below the SMA and the RSI trades in bearish territory below 50. https://www.forexcrunch.com/blog/2024/10/30/aud-usd-price-analysis-cooling-inflation-weighs-on-aussie/

2024-10-29 11:01

Oil price recovered on Tuesday after a 6% decline in the previous session. The US announced plans to buy about 3 million barrels of oil. The US will release figures on employment and GDP. The USD/CAD price analysis suggests a rebound in the Canadian dollar as oil prices rise. However, the loonie has had a terrible month with weak economic data and a massive BoC rate cut. At the same time, the greenback paused its rally as market participants waited on the sidelines for key data and the US presidential election. Oil prices recovered on Tuesday after a 6% decline in the previous session. The rebound came after the US announced plans to buy about 3 million barrels of oil for its Strategic Petroleum Reserve. Canada is a net exporter of oil, so a rally in oil boosts the loonie. Nevertheless, the currency has had a difficult month as Canada’s economy deteriorated. At the same time, inflation eased more than expected, pushing the Bank of Canada to implement a significant rate cut. If the trend continues, the BoC will remain its peers’ most dovish central bank. Meanwhile, the Fed has assumed a more cautious tone. Policymakers are less dovish after a series of better-than-expected economic reports. Moreover, inflation came in higher than expected in September. Consequently, markets are pricing a higher chance of a small rate cut in November. However, incoming data might change this outlook. This week, the US will release figures on employment and GDP. Economists expect a growth of 3.0% in the third quarter. Meanwhile, job growth might slow down from the previous month. Upbeat figures will lower the likelihood of a rat cut, while downbeat data will solidify rate-cut bets. USD/CAD key events today CB Consumer Confidence JOLTS Job Openings BOC Gov Macklem Speaks USD/CAD technical price analysis: Bearish RSI divergence On the technical side, the USD/CAD price is pulling back after reaching the 1.3901 resistance level. However, the bullish bias remains intact since the price trades above the 30-SMA with the RSI above 50. USD/CAD has remained in a bullish trend since bulls took charge at the bottom of the 4-hour chart. –Are you interested to learn more about forex signals? Check our detailed guide- However, momentum started declining after the uptrend hit the 1.3825 resistance level. The RSI made a bearish divergence that could lead to a reversal. However, bulls might push for a new high above 1.3901 if the SMA holds firm. https://www.forexcrunch.com/blog/2024/10/29/usd-cad-price-analysis-cad-strengthens-as-oil-recover/

2024-10-29 08:40

The dollar eased slightly on Tuesday as traders awaited crucial data. The US economy might expand by 3.0% in Q3. Economists expect the nonfarm payrolls report to show an addition of 111,000 jobs in October. The GBP/USD outlook shows a pause in the decline as market participants await key US economic data and the US presidential election. Meanwhile, the pound recovered as traders adjusted to the Bank of England’s more cautious stance. The dollar eased slightly on Tuesday as traders awaited crucial data. Nevertheless, it has had a strong month due to better-than-expected US economic data and the looming US presidential election. The US economy has shown resilience despite high interest rates. Consumer spending has remained high, and the labor sector has shown solid demand. This week, market participants are awaiting crucial employment and GDP data. According to estimates, the US economy might expand by 3.0% in Q3, holding after a similar expansion in the previous quarter. Meanwhile, economists expect the nonfarm payrolls report to show an addition of 111,000 jobs in October. Such an outcome would indicate a slowdown in job growth from the previous month. A better-than-expected employment report will further propel the dollar, leading to a decline in GBP/USD. On the other hand, if the labor market weakens, it could raise Fed rate cut expectations, weakening the dollar. Meanwhile, next week’s US presidential election will likely cause a lot of turmoil. The race is tight, meaning the outcome will increase market volatility. Furthermore, the dollar has rallied every time bets have supported a Trump presidency. Therefore, if he wins, the greenback might rally. Meanwhile, the pound recovered on a cautious Bank of England policy outlook. Policymakers like Andrew Bailey and Catherine Mann expressed caution regarding inflation last week, hurting rate-cut expectations. GBP/USD key events today CB Consumer Confidence JOLTS Job Openings GBP/USD technical outlook: Bulls attempt takeover above the 30-SMA On the technical side, the GBP/USD price is trading above the 30-SMA, a sign that bulls are challenging the downtrend. At the same time, the RSI trades above 50, supporting bullish momentum. –Are you interested to learn more about forex signals? Check our detailed guide- Bulls are attempting a takeover after the downtrend lost steam and the RSI made a bullish divergence. However, the new move faces strong resistance at the 1.3000 level. A break above would confirm a shift in sentiment, with the next target at the 1.3100 level. https://www.forexcrunch.com/blog/2024/10/29/gbp-usd-outlook-eyes-on-us-data-and-election/

2024-10-28 10:16

Sales in Canada rose by 0.4% compared to a 0.5% forecast. The US economy is doing much better than most economists forecast. Traders are awaiting the crucial US presidential election. The USD/CAD outlook shows an economic divergence between Canada and the US, which has propelled the pair higher. At the same time, the Bank of Canada has become more aggressive in lowering borrowing costs. On the other hand, markets are expecting the Fed to assume a more gradual pace for rate cuts. The Canadian dollar fell on Friday after domestic data showed weaker-than-expected retail sales. Sales rose by 0.4% compared to forecasts of a 0.5% increase. Meanwhile, core retail sales plunged by 0.7% compared to estimates for a 0.3% drop. Canada’s economy has continued to deteriorate, pushing the Bank of Canada to cut rates by a massive 50-bps. On the other hand, the US economy is doing much better than most economists forecast. Sales rose more than expected in September, and the labor market has remained tight. As a result, markets are pricing a gradual pace for rate cuts by the Federal Reserve. The shift to more aggressive rate cuts in Canada last week has created a slight policy divergence between the BoC and the Fed. As a result, the outlook for USD/CAD remains bright. An aggressive rate-cutting cycle will weaken the loonie, while a gradual one will eventually boost the dollar. Meanwhile, traders are awaiting the crucial US presidential election next week. The outcome could affect both fiscal and monetary policy in the US. Consequently, the greenback might rally or collapse. Additionally, market participants will watch US GDP and monthly employment figures for more clues on the upcoming FOMC meeting. USD/CAD key events today BOC Gov Macklem Speaks USD/CAD technical outlook: Weaker momentum On the technical side, the USD/CAD price has continued its uptrend despite weaker bullish momentum. The price recently broke above the 1.3825 resistance and rallied to the 1.3901 key level. However, the indicators and price action show weakness in the uptrend. –Are you interested to learn more about forex signals? Check our detailed guide- The price is sticking close to the 30-SMA, a sign that bulls have lost enthusiasm to make large swings. Meanwhile, the RSI has made a bearish divergence, indicating fading bullish momentum. Finally, bears are stronger and have prompted several pullbacks to the 30-SMA. Therefore, the trend might soon reverse with a break below the SMA. https://www.forexcrunch.com/blog/2024/10/28/usd-cad-outlook-soars-above-1-39-amid-economic-divergence/

2024-10-28 08:26

The yen collapsed to a three-month low after Japan’s election. Japan’s ruling Liberal Democratic Party won only 215 seats. The likelihood of a Trump win in the November election has boosted the greenback. The USD/JPY forecast shows lower expectations for BoJ rate hikes after Japan’s election, which has left the yen fragile. At the same time, the dollar remained strong and was heading for a monthly gain due to better-than-expected economic data and the Trump trade. After Japan’s election, the yen collapsed to a three-month low as market participants slashed BoJ rate hike expectations. The Liberal Democratic Party won only 215 seats, below the majority of 233. Consequently, it creates a challenging outlook for fiscal and monetary policies. At the same time, the Bank of Japan might assume a cautious tone due to political uncertainty. Economists expect the next rate hike in March next year. Meanwhile, inflation figures have shown weak consumption that could lead to further hike delays. As the yen declines, top officials in Japan have warned against sharp moves. Notably, the yen has had the biggest loss against the dollar this month, at 6.4%. Meanwhile, the US dollar has gained amid signs that the US economy remains resilient despite high interest rates. Data throughout the month has revealed a better-than-expected performance, which has reduced Fed rate cut bets. Traders went from pricing in a 50-bps rate cut in November to a 25-bps rate cut. At the same time, the likelihood of a Trump win in the November election has boosted the greenback. Trump’s policies might increase inflation, pausing the Fed’s rate-cutting cycle. USD/JPY key events today Market participants will keep digesting Japan’s election outcome as there will be no key events today. USD/JPY technical forecast: Bullish momentum fades above 153.00 On the technical side, the USD/JPY price has reached a new high above the 153.00 resistance level. Moreover, the price trades well above the 30-SMA with the RSI above 50, suggesting a bullish trend. –Are you interested to learn more about forex signals? Check our detailed guide- However, the RSI has also made a bearish divergence, indicating weaker bullish momentum. Therefore, bulls might be exhausted, allowing bears to take charge by pushing below the 30-SMA. A break below the SMA would allow the price to reach the 150.00 support level. However, if bulls regain momentum, the price might only revisit the SMA before making new highs above 153.00. https://www.forexcrunch.com/blog/2024/10/28/usd-jpy-forecast-yen-vulnerable-after-japan-elections/

2024-10-27 09:57

US jobless claims fell more than expected, indicating solid demand for labor. US PMI data showed growth in the manufacturing and services sectors. Tokyo CPI numbers showed inflation easing below the central bank’s 2% target. The USD/JPY weekly forecast supports further upside as markets anticipate a gradual Fed rate-cutting cycle and a less hawkish BoJ. Ups and downs of USD/JPY The USD/JPY pair had a bullish week as market participants focused on the US economy’s resilience. At the same time, inflation figures in Japan eased, lowering expectations for BoJ rate hikes. US data during the week showed that jobless claims fell more than expected, indicating solid demand for labor. Meanwhile, PMI data showed growth in the manufacturing and services sectors. Consequently, there is less pressure on the Fed to lower borrowing costs. In Japan, Tokyo CPI numbers showed inflation easing below the central bank’s 2% target, complicating the outlook for BoJ rate hikes and weighing on the yen. Next week’s key events for USD/JPY Next week, the Bank of Japan will hold its policy meeting and likely keep rates unchanged. Meanwhile, the US will release data on GDP, monthly employment and manufacturing PMI. The outlook for rate hikes in Japan has shifted with the new Prime Minister and incoming economic data. Ishiba noted that the economy was not ready for more rate hikes. Meanwhile, inflation data has shown weak consumption, further challenging the outlook. On the other hand, the US economy has remained resilient with robust demand. Therefore, there is a high chance the NFP report will show strong job growth, reducing bets for a November Fed rate cut. USD/JPY weekly technical forecast: 0.618 Fib resistance poses challenge On the technical side, the USD/JPY price has started a new bullish trend that has paused near the 153.00 resistance level. The bullish bias is strong since the price has traded well above the 22-SMA since bulls took control. At the same time, the RSI has stayed near the overbought region, suggesting solid bullish momentum. –Are you interested to learn more about forex signals? Check our detailed guide- However, the new bullish trend is facing a solid resistance zone comprising the 0.618 Fib retracement level and the 153.00 psychological level. Therefore, the price might pause at this level before either breaking above or pulling back to retest the SMA support. Nevertheless, as long as USD/JPY stays above the SMA, it will eventually break the resistance zone and retest the 158.04 resistance level. https://www.forexcrunch.com/blog/2024/10/27/usd-jpy-weekly-forecast-fed-boj-divergence-triggers-buying/