Weekly Market Overview: Post-NFP Data

<WikiFX Malaysia Original: Editor – Fion>

On Friday night (UTC +8 8.30 pm), the Non-Farm Payrolls report was released. The actual data did not meet the consensus expectations; thus it was deemed as a bad report. The actual figure was only 431K in contrast with the forecasted figure of 490K.

Let us take a closer look at how gold and the US Dollar reacted to the release of NFP data last Friday night.

Based on the 5-minute technical chart, gold had a volatile movement of nearly 100 pips. When the report was released, gold dropped to the area of 1925 before quickly rebounding up to 1934 (highlighted in the purple rectangular box above).

However, the impulsive price movement was still not strong enough for an upside breakthrough. Gold price challenged the 1934 area twice and formed a double top before heading south.

When the volatility caused by the report finally subsided, gold showed its real direction with several lower high formations. As of writing, gold is trading around the area of 1917.

That concluded a drop of nearly 170 pips from the highest point of 1934 on Friday night.

On the other hand, the US Dollar rallied to the upside when the NFP report was released (highlighted in the purple rectangular box above). It moved steadily to the area of 98.750.

However, it still failed to break through this strong resistance area - previously explained in our article here: https://www.wikifx.com/en/newsdetail/202203302654517267.html.

Currently, USD is consolidating slightly below the 99.00 resistance area, hovering around the 98.500 level.

If it continues to maintain above this area and does not break the key support level of 97.500 that was mentioned last week (see link above), it is probable for the price to challenge the aforementioned supply zone once again in the near future.

This week, there is not many high impact news, except a handful of events listed below:

On Tuesday (5th of April at UTC +8 12.30 pm), the interest rate decision will be announced in Australia. It is projected that the cash rate would remain the same as previously at 0.1%, whilst there is no consensus for the Reserve Bank of Australia (RBA) statement.

On Thursday (7th of April), the Federal Open Market Committees (FOMC) March meeting minutes will be released at (UTC +8) 2.00 am. The minutes covering the March 15-16th FOMC meeting would reveal the path forward for interest rates. Although the Federal Reserve announced its intention to hike interest rates a few times within the year, there is still no details in relation to the extent this would be carried out as well as the degree of balance-sheet reduction.

On Friday (8th of April at UTC +8 8.30 pm), Canada will be announcing its employment change data and unemployment rate. The forecast result for employment change is 65.5K from the previously recorded 336.6K whereas it is expected for the employment rate to drop to 5.4% from the previous record of 5.5%.

<WikiFX Malaysia Original: Editor – Fion>