After Jobs Data, the Dow rises more than 2%.

The US stock markets rose on Friday as a result of the unemployment rate reaching its highest level in seven months. The Dow led the way and ended the day up 2.12%, followed by the S&P and Nasdaq, which gained 1.45% and 1.07%, respectively. Despite yet another excellent non-arms print of 339k versus the forecast of 193k, the unemployment rate increased. With the DXY up 0.5%, there were significant responses from the dollar and US treasury yields. Haven Gold continued to decline, returning to recent weekly lows, while oil increased by more than 2% in anticipation of the OPEC meeting this weekend.

Beginning the Week in a Positive Tone

Following the major US indexes’ Friday rally, Asian stock markets were expected to follow Wall Street’s lead today. Traders anticipate risk-positive developments in the near term because the macroeconomic calendar does not appear to have anything to alter this outlook. With the announcement of the most recent CPI data imminent, attention will momentarily shift in the European market to Switzerland. A 0.3% monthly gain is anticipated. The most recent US ISM Service PMI figure is due in the New York session and is predicted to print around the 52.6 mark.

What happened in the Asian Session?

Due to conflicting economic data, the AUD could see volatility. The MI Inflation Gauge unexpectedly increased to 0.9% from a predicted 0.2%, which could put pressure on the Reserve Bank of Australia to raise interest rates. The ANZ labour Advertisements increased little to 0.1%, signalling a gradual improvement in the labour market. However, the Company’s Operating Profits are below forecasts, coming in at 0.5% vs 2.1%, indicating a tougher business environment.

What does it mean for Europe & US Sessions?

Before the release of the ISM Services PMI data, the DXY will likely be in a consolidative mood between 103.50 and 104.40. USD/CHF is anticipated to fluctuate between 0.9040 and 0.9140 concurrently.

The Dollar Index (DXY)

Key news events today

ISM Services PMI

What can we expect from DXY today?

With a predicted value of 52.6, the impending release of the ISM Services PMI data is anticipated to have a minor effect on the foreign exchange market. If the actual figures come in at or above expectations, showing sector expansion, it might increase investor confidence and support the currency. The PMI rating before that was 51.9, which indicated a small improvement.

Central Bank Notes:

• The committee raised the target range for the federal funds rate to 5 to 5-1/4 per cent. The U.S. banking system is sound and resilient.
• Tighter credit conditions for households and businesses may weigh on economic activity, hiring, and inflation.
• The committee is committed to returning inflation to its 2% objective
• The committee will adjust monetary policy as appropriate if risks emerge that could impede the attainment of goals
• The next meeting is on 14 June 2023

Next 24 Hours Bias

Mixed

Gold (XAU)

Key news events today

No major news events.

What can we expect from Gold today?

The recent employment statistics release has had a conflicting impact on the USD. Because investors may perceive the data differently and look to gold as a safe-haven asset during uncertain times, these mixed indicators may have an indirect effect on the price of gold.

Next 24 Hours Bias

Mixed

The Swiss Franc (CHF)

Key news events today

CPI m/m

What can we expect from CHF today?

The projected Swiss CPI m/m data will be 0.3%, up from the previous CPI m/m number of 0.0%. The CHF may rise if the actual CPI is higher than expected, signalling rising inflation and a likely tightening of monetary policy. In contrast, a lower-than-anticipated CPI would cause the CHF to decline due to fears about a probable downturn in the economy and weaker inflationary pressures. 

Central Bank Notes:

• Raised policy rate to 1.5% to counter inflationary pressure and ensure price stability. The SNB may need to raise the policy rate further in the future
• The SNB is providing liquidity assistance to Credit Suisse, and the crisis has been halted
• The new inflation forecast assumes a policy rate of 1.5% and puts average annual inflation at 2.6% for 2023 and 2.0% for 2024 and 2025.
• Mortgage and real estate market vulnerabilities persist
• Next meeting on 22 June 2023

Next 24 Hours Bias

Weak bullish

Global Markets:

Asian Stock Markets: Nikkei is up 2.20%, Shanghai Composite is up 0.07%, Hang Seng is up 0.80%, ASX is up 1.00%

European equities, the DAX futures up 0.15%, CAC 40 down 0.11%, and FTSE up 0.37%.

US Stock Market: Dow Jones is up 2.12%, S&P 500 is up 1.45%, and Nasdaq 100 is up at 1.07%.  

Commodities: Gold at $1941.21 (-0.28%), Silver at $23.40 (-0.86%), Brent Oil at $77.39 (+1.55%), WTI Oil at $72.92 (+1.70%)

News & Data

• (GBP) Composite PMI (May) Forecast 53.9, Previous 54.9 at 14:00
• (GBP) Service PMI (May) Forecast 55.1, Previous 55.9 at 14:00
• (USD) Service PMI (May) Forecast 55.1, Previous 53.6 at 19:15
• (USD) ISM Non-Manufacturing PMI (May) Forecast 51.8, Previous 51.9 at 19:30
• (AUD) Company Gross Operating Profits (QoQ) (Q1) Actual 0.5%, Forecast 1.5%, Previous 10.6% at 07:00

TECHNICAL OUTLOOK

GBPUSD

The GBP/USD currency pair is currently showing movement to the downside. The price may move in the direction of the first support level as it continues to trend downward.

The initial support, which serves as overlap support, is situated at 1.2245.

The second support, which serves as a multi-swing low support, is located further down at 1.1834. This price point might draw purchasers, offering a strong buffer against additional price decreases.

On the other hand, the initial resistance level, which serves as an overlap resistance, is located at 1.2662. Any upward price movement could likely face difficulties as a result of this.

Additionally, the second resistance level, known as a pullback resistance, is situated around 1.2975. Given that sellers are likely to enter the market at this level, it might serve as a significant barrier to upward price movement.

EURUSD

The EUR/USD currency pair is currently showing bearish momentum. Price breaching below an ascending support line, which suggests a potential continuation of the negative move, has caused this to occur.

The price may carry on in its downward direction towards the first support level. This support, which is situated at 1.0080, has the potential to be a key level where buyers might join the market and stop or reverse the bearish trend because it has the character of a multi-swing low support.

 The initial resistance level is located at 1.0806 on the other side. This level has added significance as a potential hurdle to any bullish market movements because it overlaps resistance and lines up with the 50% Fibonacci retracement level.

The second resistance level, known as a multi-swing high resistance, is located at 1.1044. This implies that there is a key level where sellers may enter the market again after previously doing so, potentially halting or reversing any bullish price advances.

AUDUSD

The present bearish momentum on the AUD/USD chart indicates a downward trend in the market.

 This bearish momentum makes it likely that the price will respond negatively off the first resistance level and decline in the direction of the first support level.

The initial level of support is at 0.6496. It has been determined that this is an overlap support or a section of the market structure that has historically drawn customers.

The second support level, which acts as a swing low support and lines up with the 78.60% Fibonacci retracement, is located at 0.6386. This raises the value of the area as a possible purchase area.

On the other hand, 0.6604 represents the first resistance level. This level, which is seen as overlap resistance, can momentarily stall any upward price movements.

The second resistance level is located at 0.6790 as well. This high resistance level with many swings may be a considerable obstacle to additional price hikes.

USDJPY

Positive momentum is currently seen on the USD/JPY chart.

Based on this momentum, it’s possible that the price will keep rising in the direction of the first resistance level.

The 50% Fibonacci retracement level and the overlap support level are both present at the first support level, which is situated at 137.65.

The second support level is marked as multi-swing low support and is situated at 134.31 should the price drop below this level. Additionally, this level might draw buyers, halting the price’s further decline.

In contrast, the initial resistance level is marked as overlap resistance at 142.11 and coincides with the 61.80% Fibonacci retracement level. Any possible price increases may face resistance at this level.

The second resistance level, which is designated as a pullback resistance, is located at 144.99. This level might also serve as a check against future price hikes.

S&P 500

The price is currently above a strong ascending trend line on the US500 chart, indicating the possibility of continued positive momentum.

The price may drop to the first support level in the near future before rebounding and moving up to the first resistance level given the current momentum.

The first support level, which is located around 4238.85, has been designated as pullback support, which heightens its significance in the chart.

The significance of the intermediate support level, which is at 4077.51 and is designated as overlap support, is further emphasised.

At 4302.83, there is the first resistance level. This level coincides with the -27% Fibonacci Expansion and the 127.20% Fibonacci Extension and is seen as overlap resistance.

The second resistance level, known as a pullback resistance, is located around 4380.72 and can serve as a temporary roadblock to further price advances.

WTI CRUDE OIL

There is currently a bearish momentum seen on the WTI chart.

The price may respond off the first resistance level and extend its downward trend towards the first support level with this bearish momentum.

The initial support level, known as multi-swing low support, is located at 63.84.

The initial resistance level, known as an overlap resistance, is at 74.36. This level’s significance as a potential barrier to additional price gains is increased by the fact that it also falls within the 50% Fibonacci retracement.

The second resistance level, known as an overlap resistance, is located at 82.98. This price level reflects a former entry point for sellers into the market, which could serve as an additional barrier to price increases.

GOLD

The price is currently above a significant ascending trend line on the XAU/USD chart, displaying bullish momentum.

The price may likely continue to rise in this bullish environment towards the first barrier level.

1930.13 is the first support level. Known as multi-swing low support, this level.

1858.01 is the second support level. The 78.60% Fibonacci retracement level and this support level for the downturn are both present.

1980.39 is the initial resistance level, which is also known as an overlap resistance. The fact that sellers have already entered the market in this location could serve as a barrier to additional price hikes.

The second resistance level, which is marked as a multi-swing high resistance, is located at 2019.72. Another big impediment to future price upward momentum could exist at this level.

ETHEREUM

The price has recently broken over a strong falling resistance line on the ETH/USD chart, indicating potential future positive swings.

Given the current positive momentum, the price may continue to rise in the direction of the first resistance level.

The initial support level, known as overlap support, is located at 1850.35.

The second support level, commonly known as overlap support, is located at 1733.20.

2008.04 is the initial resistance level. Given its historical significance as a price level where selling pressure has formed and may operate as a temporary roadblock to additional price gains, this level is known as a swing high resistance.