The Non-Farm Payroll (NFP) came in stronger and with a fall in unemployment but the market reaction was instead dovish, selling off the Dollar while other assets benefit from the risk on sentiment. Separately, the ISM Service PMI, a forward looking indicator, came in terribly, potentially indicating that the FED may need to end the pace of the rate hike to not push the economy into a recession.
Next week CPI release will be key highlight for next week especially for the Dollar and equities. Expect volatility.
Upcoming Economic Release:
S&P500 continues to trade in consolidation but ended off the week on the upper region of the range. With the CPI number scheduled to be release next week, we expect price to push towards the upside as numbers are expected to come close to expectation, reflecting the impact of rising interest rate and lower CPI number.
Dollar Index (DXY)
The United States Dollar Index broker out of the range last week and pushed towards 105.575 as expected. However, price quickly reversed from the resistance zone and fell back to the range. Seller remains in control over the Dollar and only by breaking out of 105.575 resistance region can we see more potential for upside.
Gold continued to push towards the upside last week and is reaching key resistance region at 1880. Momentum has been relatively strong only the weekly chart and we expect Gold to experience some retracement when the 1880 resistance is reached.
Sugar #11 Futures - Front Month (Analysis 51-1)
Recap (Week 01 - Last Week) Take Profit - 2
Short at market reopening position reached Take Profit - 2 level where we announced to close / partial.
Trade Analysis / Setups
AUD/JPY (Analysis 2-1)
Long opportunity: Break and retest confirmation at 90.967 region towards 92.485 as Take Profit - 1 level.
Short opportunity: Break and retest confirmation at 89.898 region towards 88.158 as Take Profit - 1 level.
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