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Daily FX Brief, Aug 05 – Post-NFP Trade Setups, Weaker Dollar In Highlights!


Last week on Friday, the US jobs report was a mixed result with unemployment failing to improve, supported by a small uptick in the wage growth metric for the US.

The ramping up of trade war efforts by the US on Chinese official last week still affects the sentiment beyond key global markets and most importantly, is now pushing the US Fed into a corner to act on more US interest rate cuts.

How NFP Impacted Forex Pairs & Commodities?

Diverse jobs report prompted a small rollover in the USD, supporting the USD/JPY pair run lower to106.35.
Gold edged higher mildly to $1,458 since the release of NFP figures.
With wage growth seeing a minor improvement, unemployment failing to improve, and the new jobs added number coming out on consensus, traders saw this as an excuse to roll out of some long USD positioning on Friday.

Forex pairs are benefitting after the open today with a lower USD rate against all major counterparts. Even GBP/USD has ticked back up slightly after the open this morning to 1.2175, giving investors a magnificent entry to consider for short in this key Brexit linked GBP/USD pair.


Economic Events to Watch Today




EUR/USD – Daily Outlook

EUR/USD took a bullish turn during the Asian session, perhaps on speculation that an all-out US-China trade war would push the US Federal Reserve (Fed) to cut rates by further 50 to 75 basis points before the year-end.

The US central bank released a 25 basis point rate cut previous week but avoided from indicating further easing. The EUR/USD pair is currently trading above the 200-hour moving average (MA) of 1.1124.

For now, investors eyes will stay on the services of services PMI data from the eurozone.

  • Spanish Services PMI (Jul)
  • Italian Services PMI (Jul)
  • French Services PMI (Jul)
  • German Services PMI (Jul)
  • Eurozone Markit Composite PMI (Jul)
  • Eurozone Services PMI (Jul)

Although these are low to medium impact economic events, we may see slight movement on their release.


EUR/USD – Technical Levels
Support Resistance
1.1035 1.117
1.0963 1.1234
1.0828 1.1369
Key Trading Level: 1.1099

EUR/USD – Trade Tips

Technical indicators are coming out of the bearish zone, turning all bearish biases into bullish, to complete the bullish retracement. At the moment, pair is moving around 1.1100, and the mentioned level is working as immediate support, en route to the 1.1000 critical figure.

On the upper side, EUR/USD is heading towards the double top resistance area of 1.1160, where the bullish breakout of this level could extend the bullish trend until 1.1200.

GBP/USD – Daily Outlook

Last week, the Sterling broke down significantly, falling below the 1.2350 level. At this time, we have violated a major support level, and now it looks like we are continuing to go much lower. The 1.20 level is beckoning.

Most of the sell-off in Pound is triggered on the back of strong sentiments that Borish Johanson will go for hard-Brexit. Even if the Federal Reserve begins cutting rates, the uncertainty, of course, is yet the significant determinant in this market which is weighing on Sterling.

Brexit will cause obstacles and of course, will trade it on the fore of trader’s thoughts out there. Eventually, I think we proceed to see the US dollar rise overall, and that will be especially true against the British pound in general.


GBP/USD – Technical Levels
Support Resistance
1.2031 1.2342
1.19 1.2521
1.159 1.2831
Key Trading Level: 1.2211

GBP/USD – Trade Tips

All things being equal, though, the 1.15 level underneath would be the next support level. Ultimately, if we did turn around and break above the 1.25 handle, then we could likely turn things around, but it’s very unlikely to happen. Consider staying bearish below 1.2150 to target 1.2060 today. All the best!


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