The last two payroll reports signified the stimulus impact that made the strong rebound in the US economy questionable. Meanwhile, the weekly jobless claim declined and is currently at 2.2M, more than 500k below the previous level in August. However, the current projection of this week's NFP is 397K which is far above the previous result of 194K. Therefore, if the NFP can reach the estimation, it would increase the possibility of tapering in November. Therefore, investors should closely monitor how the Non-Farm payroll is coming where a better than expected report would create a bullish impact on the US Dollar.
Besides, this week will be eventful for the Pound, where the UK 2 year gilt yields have tripled from 0.2% to 0.7% in September. On the other hand, Bank of England Governor Andrew Bailey has expressed concern about the rising inflation rates where the BoE should act pessimistically about the Uk economy. In that case, a rate increase of 0.15% to 0.25% would not be the ultimate solution for the UK. Therefore, investors should closely monitor how the economic projection is coming from the BoE.
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Forex Technical Outlook for 01 November 2021 to 05 November 2021
This week is eventful, where a lot of economic releases are expected to be published. The week will start with the momentum from the Japanese election. Later on, the RBA cash rate, ISM Manufacturing PMI, and NZD Unemployment rate would keep the market volatile till the middle of the week. Finally, the FOMC, UK interest rate decision, Non-farm payroll, and Treasury currency report will keep the price moving until the close of the week.
The US Dollar index showed an impressive recovery last Friday, where the price ended the week by breaking above the 94.00 event level. Therefore, investors should closely monitor how the price is trading above this level. Any sign of an intraday bullish rejection would be a potential buying opportunity in the US Dollar towards the target of 95.00 area.
As per the previous projection, EUR/USD moved higher and reached the 1.1672 event-level but failed to hold the bullish momentum above it. As a result, bears took control over the price and managed to close the week below the dynamic 20 EMA.
The above image shows how the EURUSD is trading below the dynamic 20 EMA with an impulsive bearish pressure. Meanwhile, the MACD Histogram is bullish and moving to the neutral zone. In this context, we can expect a bearish pressure in the coming days where the price has a higher possibility of moving below the 1.1500 area. On the other hand, a bullish daily close above the 1.1672 level would increase the bullish possibility towards the 1.1900 level.
GBP/USD barely touched the supply zone that increased the selling pressure last week. As a result, the price moved lower and closed last Friday’s candle below the dynamic 20 EMA. Therefore, the price possibility would remain bearish until bulls breach the supply zone.
As per the above image, the MACD Histogram is still bullish but moving to zero level. Based on the current price context, we can expect a bullish correction at the birth period of the week, where any intraday bearish rejection would be a potential selling opportunity.
Overall, for GBPUSD, there is a higher possibility of extending the bearish pressure towards 1.3585 and 1.3470 levels. However, investors should closely monitor how the BoE is releasing the economic projection. Any hawkish tone with a daily close above the 1.3900 would be a decent buying possibility in this pair.
Bulls are aggressive in the AUD/USD pair, where sellers failed to breach the 0.7472 level with a bearish daily candle. As a result, the price rebounded and made a new swing high at the 0.7559 level. Meanwhile, the dynamic 20 EMA is below the price and approaching higher to provide minor support to the price. In that case, the bullish possibility is potent until the price breaks below the 0.7472 level.
The above image shows how the MACD Histogram is at a bullish area where a small correction is pending towards the dynamic 20 EMA. Therefore, investors should monitor how the week opens where a bullish rejection from 0.7472 or dynamic 20 EMA would be a buying possibility with the target of 0.7657 level.
The uncertainty in Japan regarding the election is keeping the USD/JPY price indecisive above the 113.22 support level. However, bulls are still holding the price above the dynamic 20 EMA for a considerable time, which signifies an upcoming bullish pressure.
The above image shows how the price is trading above the 113.22 support level where the dynamic 20 EMA is approaching the price and providing support. Meanwhile, the MACD Histogram is bearish with no impact on the price. In this context, the bullish possibility towards the 115.00 level is valid until the price breaks below the 113.22 level with a bearish daily close.
XAU/USD passed an extremely volatile week, where the price failed to break below the 1772.83 support level. The uncertainty regarding geopolitics keeps the XAUUSD price valuable, and this momentum may extend in the coming days.
As per the above image, we can see that the XAUUSD has a bullish rejection from the dynamic 20 EMA while the MACD Histogram remains bullish. In this context, we can expect the bullish possibility to extend towards the 1811.62 level in the coming day. In that case, a bullish daily candle above 1800 would increase the buying possibility. Conversely, a bearish daily candle below the 1773.83 level would open rooms for the 1749.40 level.
The BTC/USD bullish rally showed a corrective momentum last week where the price moved from 66,955.00 swings high to 56,386.77 swing low with a corrective momentum. However, bears failed to take the price below the 57,400.00 support level from where a bullish rejection candle appeared. Therefore, as long as bulls hold the price above the 57,400.00 level, it is more likely to extend the bullish pressure towards the 68,000 level.
The above image shows that the MACD Histogram remained bearish but was unable to make a new low. Meanwhile, the trading volume in the crypto market is surging where the BTCUSD has a strong store value. Therefore, the bullish possibility of the BTCUSD may extend even more beyond the 68,000.00 psychological level based on the recent acceptance of Bitcoin futures ETF in NYSE.
Overall, investors will experience a volatile week where a lot of economic releases are set to publish. Among these, the FOMC and BoE meeting would be important where any hawkish tone from the FED would increase the buying pressure on the US Dollar.