With a leading jobs indicator due from the U.S. later in the day, traders could start pricing in expectations for this major release.
It’s no secret that the labor situation in the country has taken a huge hit from the pandemic and contagion efforts, so traders might be looking for a chance to short the dollar.
But first, here’s a quick look at how the majors are doing:
Fresh Market Headlines & Economic Data:
- New Zealand PM Ardern says country is safe-haven for investment
- GDT auction yields 0.8% drop in dairy prices after earlier 4.2% slide
- RBNZ published a paper warning on impact of COVID-19, projects a large drop in GDP
- New Zealand Q1 employment up 0.7% vs. projected 0.2% drop
- New Zealand Q1 jobless rate up from 4.0% to 4.2% vs. 4.4% forecast
- New Zealand Q4 2019 employment upgraded to show 0.1% gain
- Australian retail sales rose 8.5% m/m vs. 8.2% forecast and previous
Upcoming Potential Catalysts on the Economic Calendar:
- German factory orders due 7:00 am GMT
- Euro zone final services PMIs at 8:15 am GMT
- Euro zone retail sales at 10:00 am GMT
- EU economic forecasts due tentatively
What to Watch: USD/CHF
This pair has been pacing back and forth inside a range with support at the .9600 major psychological mark and resistance near .9800.USD/CHF is closing in on the top of the range, which might once again keep gains in check. If so, price could fall back to support or at least halfway through.
Stochastic has been indicating overbought conditions for quite some time and looks ready to turn lower to indicate that bearish pressure is ready to return.
At the same time, the 100 SMA is below the 200 SMA to hint that resistance is more likely to hold than to break.There are a few reports to watch out for in the upcoming London session, but traders might have their sights set on the U.S. ADP report due much later on.
Dollar traders seem keen on placing bets on the April NFP report, at least based on how the currency has been reacting to weekly initial jobless claims data.
If you’re planning on trading the test of this pair’s range resistance, make sure you account for the average USD/CHF volatility in setting entries and exits.