Friday Market Update

USDX: 94.60

Dollar Index was mixed in overnight trade, back to familiar 93.50 area.

The new Fed Chair is likely to be Jerome Powell and possibly spiral more USDX pain too, as USD profit taking after last week’s rally may occur, plus the bigger theme of him being quite Dollar neutral.

The big story is the first phase of US Tax Reform which was released, dragging USDX down initially, but it recovered quickly to lift back above 93.50.

USD JPY: 114.05

Dollar-Yen spiked down to 113.50 briefly before recovering back slightly above the 114 handle.

The Tax Reform proposal jolted USDJPY, but I can a bigger jolt coming in this evenings US trading session on the release of US Jobs headline data.

USDJPY could easily be Offered back towards 112 if the US data disappoints.

It will take a 320K + print on jobs numbers to lift to 115 this evening for USDJPY.

Bank Of Japan did not rock the Yen outlook boat at all on Tuesday, so this pair is totally at the mercy of the USD sentiment.

EUR USD: 1.1660

Euro traded higher, lifting to 1.1680 as the softer USD theme played out.

I am certain that the USD will be in the driver’s seat this week for EURUSD, so it’s all about the US Tax Reform news, Fed Chair announcement and of course, NFP data on Friday in the US Session open.

I called a move back to 1.1680 (as a ceiling) in the easyMarkets Weekly Outlook video on Monday, and that level looks like a hard resistance level, ahead of these risk events to follow.

Expect big volatility in EURUSD over the NFP Friday headlines so the range will be widened to 1.1750 – 1.1550.

GBP USD: 1.3060

Sterling traded up to 1.3300 in Asian dealing yesterday, then started a sift move lower to around 1.3225 leading into the key Bank of England press conference.

Rates were raised by a 7-2 vote, lifting 25 Basis Points, but the inflation outlook and working for the next rate hikes were taken as Dovish, collapsing GBP very sharply.

The selloff Was fierce, seeing 2 big figure moves lower to rest around 1.3050.

The prospect of a sharp reversal was always high, as was the risk in trading GBP pairs last night because the commentary from the BoE has been as subtle as a torpedo in the bow.

Consolidation from here is very likely, particularly If the USD data disappoints on the big forecasts.

If the NFP data is solid for USD we will once again be trading under the 1.30 level for GBPUSD.

AUD USD: 0.7715

The Aussie lifted above the 77 handle yesterday on the back of the stronger than expected Aussie Trade Balance data.

I think Buyers will step on even if we see Powell announced as the new Fed chair, and the AUDUSD recovers 7730 price level.

The small rally in AUD fizzled out quick quickly as traders are doubting the USD outlook with Tax Reform plans causing uncertainty plus the potential for a big US Payroll data report card this evening.
AUDUSD can jolt back towards 78c if the headline data misses the target.

There are a lot of chances this week for USD disappointment, but the focus now shifts to the headline US Payroll data and more details regarding the US Tax Reform.

NZD USD: 0.6915

The NZDUSD got a solid lift back up above 69c against the Greenback after the better-than-expected NZ Unemployment (improving to 4.6%) and soft open in the USD covering on Thursday.

The geopolitical risks to the NZD are large so this pair can get back towards 68c if the USD data is as strong as it is perceived to be.

The NZDUSD is likely to find Selling pressure again in the week ahead in my view.
I am looking for lower lows to be the theme.

USD CAD: 1.2800

Dollar-CAD has had an interesting trading week, hampered lower from 1.2910.

I called this back to 1.3000 this week in our weekly outlook, m and it will certainly trade there if NFP is a stellar result for the Dollar Bulls.

Over the mid-term, it still looks a great trade up to 1.3000, but it has stalled mid-flight here on the 1.2800 handle as the USD position is in the Drivers Seat.

There is also key Canadian data released at the same time as the US data so watch for good Volatility & opportunities tonight in USDCAD and CAD cross pairs such as GBPCAD.

VIX: 9.93

US Stocks are holding up firmly this week ahead of the hugely important US Tax Reform agenda rollout.
In fact, they are robust, with the DOW trading mid 23,000 and looking solid.

The Volatility Index is holding around 10 but lets see where it is end of November, as big moves are getting more and more likely by the day.

Look for a breakdown in stocks before year-end, possible a large correction in my view.
Stocks should get a lift, holding back the VIX now that Powell will be the new Fed Chair.

GOLD: $1,276.50

Gold spiked to 1283 before settling back mildly, as I said it would due to Powell being quite Dollar neutral.

Price action on Tuesday seems fair value to me, as we are staring at a LOT of uncertainty around the USD outlook/sentiment this coming week.
That creates an opportunity this week if the NFP data disappoints for the USD bulls.

Expect a volatile week ahead for GOLD and breakouts may start as early this evening on the Interim US payroll data release. I am looking for a + $1300 move on USD disappointment.

OIL (WTI): $54.75

After a move to $55 and a sharp retracement lower this week, Oil has found support once again.

The WTI price was Bid back up towards $55 and likely to carry on higher from my research.

Price action suggests that a new support base at $54 will help Oil prices lift again, towards $57 or higher before profit-taking kicks in.

There was Bullish price action overnight, as Oil shook off the pullback from Wednesday and a strong lift occurred again.

BITCOIN (BTC): $7,090

Bitcoin ripped higher overnight, seeing a new all-time high around $7,300 before we retreat.

The pullback/retreat was short-lived and the bullish upward momentum resumed, now holding above the $7000 area.

ETF for Bitcoin are also coming soon so my call of $7,500 by year-end is very much in play, after getting over the hurdle at $7000 yesterday.

The momentum has switched to be strongly bullish again after the midweek lows on the back of the Bitcoin Gold fork, so look for $7,500 by the end of this month potentially!

The easyMarkets MetaTrader 4 platform now has Bitcoin!

Macro Themes in Play

• Fed Chair will be Jerome Powell, USD mixed
• Bank Of England commentary & outlook crunched the GBP
• USD Traders looking to the Big forecast for US Payrolls tonight