*NEWS: The Dollar Index (DXY)*
*Dollar Index Holds Steady Amid Rate Cut Expectations and Labor Market Resilience*
• The dollar index remained stable around 104.2, marking its weakest levels in over a week.
• Investors reviewed interest rate prospects amidst anticipation for the US monthly jobs report.
• ISM data showed a service sector growth slowdown, reinforcing rate-cut expectations and impacting the dollar.
• ADP data revealed the addition of 184,000 private-sector jobs in March, reflecting a robust labor market.
• Federal Reserve Chair Jerome Powell emphasized the need for further evidence of inflation reaching the 2% target before considering rate cuts.
• Atlanta Fed President Raphael Bostic suggested the possibility of a single rate cut, while others maintained forecasts for policy easing this year.
*Dollar Index Holds Steady Amid Rate Cut Expectations and Labor Market Resilience*
• The dollar index remained stable around 104.2, marking its weakest levels in over a week.
• Investors reviewed interest rate prospects amidst anticipation for the US monthly jobs report.
• ISM data showed a service sector growth slowdown, reinforcing rate-cut expectations and impacting the dollar.
• ADP data revealed the addition of 184,000 private-sector jobs in March, reflecting a robust labor market.
• Federal Reserve Chair Jerome Powell emphasized the need for further evidence of inflation reaching the 2% target before considering rate cuts.
• Atlanta Fed President Raphael Bostic suggested the possibility of a single rate cut, while others maintained forecasts for policy easing this year.
METALS: SELL STOP IN GOLD AT 2295
TP1:2290
TP2:2285
SL:2310
TP1:2290
TP2:2285
SL:2310
*Friday’s Economic Calendar*
*The Labor Data including NFP & Unemployment Data Captures the Spotlight Today*
• *NFP*: Previous = 275K; Forecast = 212K (lower than previous)
• *Unemployment Rate*: Previous = 3.9%; Forecast = 3.9% (same as previous)
*The Labor Data including NFP & Unemployment Data Captures the Spotlight Today*
• *NFP*: Previous = 275K; Forecast = 212K (lower than previous)
• *Unemployment Rate*: Previous = 3.9%; Forecast = 3.9% (same as previous)
*What are Nonfarm Payrolls or NFP?*
• Nonfarm payrolls are the monthly report published by the US BLS (Bureau of Labor Statistics)
• It measures the number of jobs added or lost in the US economy during the prior month.
• Nonfarm payrolls are the monthly report published by the US BLS (Bureau of Labor Statistics)
• It measures the number of jobs added or lost in the US economy during the prior month.
*Analysis of NFP*
*1. Action:* If NFP rises ↑ than expected, i.e. Jobs are added, indicating the economy is growing faster
*Reaction:* The Fed might consider a delay in interest rate cuts to control sticky inflation.
*2. Action:* Conversely, if NFP falls↓, it may indicate that people do not have jobs & money in their hands, & the economy might slow down
*Reaction:* The Fed might start signaling rate cuts soon.
*Note:* Fed Officials have already announced 3 rate cuts in FY 2024 with around 25 bps each and reducing the prevailing rates by around 75 bps
*1. Action:* If NFP rises ↑ than expected, i.e. Jobs are added, indicating the economy is growing faster
*Reaction:* The Fed might consider a delay in interest rate cuts to control sticky inflation.
*2. Action:* Conversely, if NFP falls↓, it may indicate that people do not have jobs & money in their hands, & the economy might slow down
*Reaction:* The Fed might start signaling rate cuts soon.
*Note:* Fed Officials have already announced 3 rate cuts in FY 2024 with around 25 bps each and reducing the prevailing rates by around 75 bps
*Impact of NFP on Dollar & Gold*
• NFP report can significantly impact the US dollar and gold prices.
• Strong data could lead to an increased US dollar value, as investors may view a strong US economy.
• As a result associated scripts like Gold might witness downfalls.
• And vice-versa.
• NFP report can significantly impact the US dollar and gold prices.
• Strong data could lead to an increased US dollar value, as investors may view a strong US economy.
• As a result associated scripts like Gold might witness downfalls.
• And vice-versa.
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*April 08, 2024: Monday*
*Daily News & Analysis*
*NEWS: The Dollar Index (DXY)*
*US Dollar Holds Steady as Investors Await Key Inflation Data*
• The dollar index steadied around 104.3 on Monday amidst anticipation of significant US inflation readings.
• Last week, the index experienced increased volatility, with investors exercising caution ahead of crucial data releases.
• The robust US jobs report on Friday, showcasing 303K job additions in March, tempered expectations of Federal Reserve rate cuts.
• Fed officials, notably Neel Kashkari and Jerome Powell, highlighted the importance of monitoring inflation trends before considering rate reductions.
• Markets are now pricing approx. a 49% chance (even less than 50%) of a Fed rate cut in June, with expectations shifting towards July as the potential start of an easing cycle.
*Daily News & Analysis*
*NEWS: The Dollar Index (DXY)*
*US Dollar Holds Steady as Investors Await Key Inflation Data*
• The dollar index steadied around 104.3 on Monday amidst anticipation of significant US inflation readings.
• Last week, the index experienced increased volatility, with investors exercising caution ahead of crucial data releases.
• The robust US jobs report on Friday, showcasing 303K job additions in March, tempered expectations of Federal Reserve rate cuts.
• Fed officials, notably Neel Kashkari and Jerome Powell, highlighted the importance of monitoring inflation trends before considering rate reductions.
• Markets are now pricing approx. a 49% chance (even less than 50%) of a Fed rate cut in June, with expectations shifting towards July as the potential start of an easing cycle.
*Analysis: The Dollar Index (DXY)*
*Previous Week’s Recap*
• The DXY started the previous week with strength with positive Manufacturing PMI and made highs of 105.10.
• Since then prices have started declining due to negative labor reports & declining Service PM data, where DXY made lows of 103.90 and created support between a range of 104.00 & 104.15.
• Since Thursday, prices again started rising taking support at 104.0, and with the release of NFP data on Friday, it made highs of 104.70.
• However, it failed to sustain higher and since then it has been consolidating in a narrow range.
*Previous Week’s Recap*
• The DXY started the previous week with strength with positive Manufacturing PMI and made highs of 105.10.
• Since then prices have started declining due to negative labor reports & declining Service PM data, where DXY made lows of 103.90 and created support between a range of 104.00 & 104.15.
• Since Thursday, prices again started rising taking support at 104.0, and with the release of NFP data on Friday, it made highs of 104.70.
• However, it failed to sustain higher and since then it has been consolidating in a narrow range.
*Current Situation & Projection:*
• As visible on the attached 4H chart, the index extended the uncertain price behavior amid a dicey Fed outlook toward interest rate cuts.
• Prices are ranging in a narrow range between 104.25 & 104.40.
• While writing the report, the prices are trending at 104.35.
*Technical Analysis*
• Prices are currently trending steadily sideways taking the support of middle Bollinger band.
• Prices might continue rising with next resistance at 104.50.
• The RSI is also stabilizing in the selling zone below 50 level at 47.0
• Therefore, corrections might initiate in DXY.
• As visible on the attached 4H chart, the index extended the uncertain price behavior amid a dicey Fed outlook toward interest rate cuts.
• Prices are ranging in a narrow range between 104.25 & 104.40.
• While writing the report, the prices are trending at 104.35.
*Technical Analysis*
• Prices are currently trending steadily sideways taking the support of middle Bollinger band.
• Prices might continue rising with next resistance at 104.50.
• The RSI is also stabilizing in the selling zone below 50 level at 47.0
• Therefore, corrections might initiate in DXY.