Daily F.X. Analysis, Oct 04 – Top Trade Setups In Forex - Brace for U.S. NFP Report! 

The U.S. dollar continues to trade lower versus peers in the wake of ongoing geopolitical tensions and the trade war between the U.S. and China. Lately, the U.S trade representative, Robert Lighthizer, said that the World Trade Organization has confirmed that after 15 years of litigation, the United States was entitled to impose countermeasures in response to EU’s illegal subsidies. Moreover, they expect a negotiation with the European Union in terms which will be beneficial for American Workers.

Besides, the administration of Donald Trump announced to impose 25% tariffs on cheese, French wine, Scotch and Irish whiskeys, olives, business suits & sweaters, and a 10% tariff on European-made Airbus, as a punishment for illegal aircrafts subsidies.

On Friday, the focus mostly remains on the U.S. Non-farm payroll data, which is scheduled to be released during the New York session. 

Economic Calendar -   Brace for U.S. NFP Report

BTC/USD - Daily Analysis

The BTC/USD has further increased its period of consolidation as it remains trading in narrow ranges near $8,200 level, which seems to be a critical support level. The bulls of Bitcoin demand to resist crypto to trader higher in the short-term.

Technically, the BTC/USD is creating a sort of double bottom, but this event will only be confirmed if the BTC can place an upwards move from its fresh lows. The leading crypto pair has formed a Doji candle, which signifies indecision among investors and the same time holds below the 200-day moving average, nullifying the corrective surge from fresh lows near $7,700. 

For now, the bullish crossover move above the 200 periods moving average can drive a bullish trend on the BTC/USD. Significant resistance stays at 8,500. 

BTC/USD - Daily Technical Levels

Support    Resistance 

7,727.14     8,447.94

7,372.57     8,814.17

6,651.77     9,534.97

Pivot Point 8,093.37

BTC/USD – Daily Forecast

The BTCUSD continues to trade below 8500 resistance area; In fact, now it's facing a slight resistance at 8,350 area, which is extending by the EMA and bearish trendline. It's been forming Doji candles below 8,350, suggesting neutral bias among traders.

On the lower side, the BTC/USD can stay bearish until 8000, and below this, the support prevails at 7910. Technically, the indicators are suggesting a bearish bias for the Bitcoin.

EUR/USD – Double Top Breakout 

A day before, the EUR/USD was opened at 1.09584 and is currently moving at 1.09695. At 12:15 GMT, the Spanish Services PMI came as 53.3 against expected 53.9 weighed the Euro. The Italian Services PMI at 12:45 GMT came in favor of Euro as 51.4 against 50.4. 

However, the French & German Final Services PMI at 12:50 GMT were against Euro to come as 51.1 & 51.4 compared to forecasted 51.6 & 52.5, respectively. The final Services PMI from Europe also weighed its currency when it was released as 51.6 weaker than expected 52.0 at 13:00 GMT. The Product Price Index and Retail Sales at 14:00 GMT, from Europe, were also disappointing as -0.5% and 0.3%, respectively.

At the starting session on Thursday, EUR/USD remained flat and showed no movement, but after the release of economic data from the European side, the pair showed mixed changes. The downward movement was most likely to be caused by the fall of German Services PMI to its lowest level in three years, which indicated the weakest growth rate in three years of the business & Service sector in September.

When the economic release from American session came on board, EUR/USD started to gain its strength given the limited release of Unemployment Claims & ISM Non-Manufacturing PMI. This weaker than expected release rose the fear that the global economic slowdown has made its impact on the US economy as well.

The pressure on the US Dollar gave strength to EUR/USD and made its movement upward to place a high of 1.09992.

The Airbus after this announcement called for both parties EU & US to negotiate a settlement before the tariffs are imposed. They warned that it would create an escalation of trade tensions to the global economy.

If the European Union and the United States reach a deal to settle their disputes, there are chances that tariffs could be avoided. However, there are no reports about them engaged in serious negotiations. Both sides have blamed each other for failure to avoid taxes.

EUR/USD - Daily Technical Levels

Support Resistance 

1.0921     1.0981

1.0883     1.1002

1.0823     1.1062

Pivot Point 1.0943

EUR/USD – Daily Forecast

The EUR/USD was placing higher's high and higher's low pattern in the hourly chart, which probably drove the bullish trend in the EURUSD. However, recently, the pair has formed a Doji at 1.0975, which is likely to drive short term bearish movement in the EURUSD can stay bullish above 1.0943 today.

GBP/USD - Services PMI Weights

GBP/USD was opened at 1.22996 and is currently moving at 1.23390 on Thursday. In the early session, the GBP/USD showed a bullish trend because of the disappointing economic data release from the united states about ISM Non-Manufacturing PMI, which came as 52.6 against 55.1 expected. This release gave the fears of the US falling under recession due to a slowdown in economic growth. Hence moved GBP/USD on an upward trend.

The GBP/USD pair placed a high of 1.24129 yesterday as British Prime Minister, Boris Johnson, explained the new proposal for Britain’s departure from European Union on Wednesday. The plan included a new regulatory zone in Northern Ireland in replacement of the backstop arrangement in the existing withdrawal bill. Boris Johnson was hoping that his new plan would unblock the stalled Brexit negotiations.

However, the proposal was quickly condemned by Northern Irish politicians and European Union Officials as in “bad faith” and “unworkable.” 

Parliament has said that in-case of no settlement of deal with EU, Johnson must seek an extension in Brexit Deadline that was set as 31st October. Still, Johnson has repeatedly vowed that he would not do such a thing and would deliver Brexit on a promised date even without a deal.

The calm response from Brussels gave further hope towards a no-deal exile of Britain from the European Union on 31st October. This has made Sterling drop against the US Dollar and created a downward trend in the late session on Thursday for GBP/USD. The Services PMI of United Kingdom at 13:30 GMT, came as 49.5 against 50.3 expected weighed on Pound on Thursday.

GBP/USD - Daily Technical Levels

Support Resistance 

1.2242     1.234

1.2186     1.2381

1.2088     1.2479

Pivot Point 1.2283

GBP/USD – Daily Forecast

The GBP/USD surged over a weaker dollars to place a high around 1.2415 resistance level but closed a test bar. The test bar reversed the GBP/USD pair to support the level of 1.2320 area. The movement in GBP/USD mostly depends upon NFP figures. Negative NFP may lead to GBP/USD towards 1.2415 and 1.2488. Conversely, the positive NFP may drive GBP/USD lower towards 1.2225 areas. Below 1.2225, the GBP/USD may find the next support around 1.2151.

All the best for today.