Talking Points:
- This morning’s NFP report was somewhat of a mixed bag, but this seemed to do little to help US Dollar bulls as DXY[1] has continued its Q3 descent below support. The likely culprit here was lagging Average Hourly Earnings within this morning’s Non-Farm Payrolls report, coming in at .2% versus the .3% expectation.
- Noticeable thus far in the new quarter is the return of EUR/USD strength[2], and the pair is now trading at a fresh post-ECB high. Prices in the pair have been in a consistent bullish pattern over the past week, and this resembles a similar scenario from last year around the ECB’s October rate decision. When the European Central Bank extended stimulus into 2018, EUR/USD[3] dropped below support and remained bearish for about two weeks. But this was soon offset by a red-hot GDP report out of Germany, and prices were pushing 1.2500 in short-order. Might we be headed for a similar scenario? European inflation came-in at a one-year high in June, and if it keeps up this pace, the ECB may have a difficult time sitting on current rates ‘at least through the summer of 2019.’
- DailyFX Forecasts on a variety of currencies such as the US Dollar[4] or the Euro[5] are available from the DailyFX Trading Guides page[6]. If you’re looking to improve your trading approach, check out Traits of Successful Traders[7]. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide[8].
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