Key Economic Indicators: What to Watch Today

Market Overview

Last weeks non-farm employment change resulted in mixed reactions, coming in at 142k—lower than expected but higher than the previous month, placing it between both levels.

The markets are pricing in a 100% chance of a 25 bp rate cut at the September 17-18 FOMC meeting and a 34% chance of a 50 bp rate cut.

With that, we may see a slowdown in the dollar after the September cut if a 25 bps cut occurs, as investors will likely anticipate further cuts in the coming months. In the short term, buying the dollar may prove profitable, while selling pressure could emerge after the data is released. However, consolidation may continue until then, allowing traders to secure funds and position themselves at a favorable price.

CPI data and PPI to come out later this week may help in the further navigation of market expectations.

MARKET ANALYSIS

GOLD - GOLD fell short after last weeks news, showing strength in the dollar as anticipated. While further strength may develop, continued consolidation is also possible. We await additional trading activity before determining a clear market bias. The 2483.417 level appears to be valid support, and we will observe market reactions.

SILVER - Silver also fell short, continuing its downward trend. We are monitoring the 27.725 level as support and will assess how the price reacts to this structure.

DXY - The dollar has rebounded after hitting lows. The chart suggests the possibility of a continued bullish market, with a potential break above 101.786. While we expect further dollar strength, market reactions to this week‘s CPI and PPI will be important. At present, markets are expecting a 25-bps cut. Depending on the chart’s progression, we may gain insight into how the price will move in the coming months.

GBPUSD - GBPUSD reached a high with an aggressive candle before continuing its sell-off. We are looking for further selling opportunities and await a break below 1.31097.

AUDUSD - AUDUSD is showing strong selling momentum as the dollar gains strength. With rising geopolitical tensions in the Middle East, the Russia-Ukraine conflict, upcoming elections, and increased tensions in the South China Sea, traders are avoiding risk on assets. Further weakness is expected for the Aussie dollar, while safe-haven assets gain strength.

NZDUSD - NZDUSD is displaying clear market weakness. We expect further declines and a potential break below 0.61408. Expectations are the same with the Aussie dollar with slight differences. The market confidence in the Kiwi remains against the Aussie dollar as markets look further into when the RBA will cut rates.

EURUSD - EURUSD is weakening as the chart indicates, hitting stops at 1.11386 as expected, before a possible continuation lower. We are waiting for a break below 1.10361 before committing to additional sells, though appropriate risk management systems should be in place. While selling opportunities look promising, the Euro remains a strong alternative to risk-on assets.

USDJPY - The Yen continues to strengthen, driving prices below 143.442. A slight recovery followed the dollars strength surge, but we expect more selling to resume in this market.

USDCHF - The Franc initially moved lower before reversing upward. While the potential for further gains exists, the market remains in consolidation without a clear directional bias. We await further price action for confirmation, with prices currently ranging between 0.84086 and 0.85541.

USDCAD - The Loonie experienced significant losses against the dollar after yesterdays trading, reflecting CAD weakness. Recent developments suggest further selling pressure on the Loonie. The price is now at 1.35762, with the potential for a break higher.