Daily F.X. Analysis, May 08 – Big Day, the U.S. Non-farm Payroll Ahead!
The U.S. dollar lost its traction after the release of Unemployment Claims for last week. Around 3.1M people reported to file claims for jobless benefits from the U.S. on Thursday and weighed on the U.S. dollar. However, it's going to be a busy day for the U.S. dollar in the wake of high impacted labor market figures, which are due during the U.S. session today. The BTC/USD is on the verge of a major breakout over a key mark of resistance after it examined $9,400 once again during yesterday evening. All of the dominoes have apparently fallen into position for BTC/USD as it advances its third block reward splitting in 11 years, with several traders demanding that it will work as an impetus for the bull market. The major level of resistance to look out for is $9,550, as this begins back to the $20,000 top in December 2017 with denials occurring along the way at $13,150, $12,500, and $10,500. Being able to achieve a daily or weekly over $9,550 would imply a clear change in the market from May when Bitcoin dropped to as low as $3,850. If a move to the upside occurs this weekend, it will symbolize a period of bullish trading above the coming weeks with targets commencing to begin over $13,000. BTC/USD - Daily Technical Levels Support Resistance 9,332 10,367 8,669 10,739 8,297 11,403 Pivot Point 9,704 BTC/USD – Daily Forecast The BTC/USD prices extended it's a bullish trend to trade at and test the 10K level. In the daily timeframe, the pair is finding immediate resistance around 10,050 levels, and violation of this level can extend buying until the next target level of 10,500, which will be market a double top pattern for the day. Below this level, we may see a slight retracement in the Bitcoin today. On the lower side, support continues to hold around 9,470 level. The EUR/USD prices were closed at 1.08314 after placing a high of 1.08339 and a low of 1.07663. Overall the movement of the EUR/USD pair remained bullish throughout the day. After falling for the past three consecutive days, EUR/USD rose on Thursday and posted gains on the back of speech made by European Central Bank's president Christine Lagarde. In reply to the German court ruling of the ECB's bond-buying program, Christine Lagarde said that ECB was not discouraged by the German constitutional court ruling of its bond purchases. She added that the Central bank would do whatever it seems necessary to support the Eurozone economy through the coronavirus crisis. Lagarde said that the European economy was facing the most severe crisis in peacetime, and it was the responsibility of the European Central Bank to take all possible measures to cope up with the crisis. She added that the second wave of coronavirus was among top fears, and there was no sense of how bad the European economy has been affected. So, ECB did whatever it felt was necessary and will do again because they were not undeterred by the German court ruling. As far as the data is concerned, at 11:00 GMT, the German Industrial Production for the month of March showed a decline of 9.2% against the forecasted decline by 7.3% and weighed on single currency EUR. At 11:45 GMT, the French Industrial Production during March also posted a decrease of 16.2% against the forecasted decline by 12.7% and weighed on EUR. The French Prelim Private Payrolls for the quarter showed a decline of 2.3% against the expected decline of 0.3% and weighed on EUR. The French Trade Balance for the month of March showed a deficit by 3.3B against the expected shortfall of 4.6B and supported EUR. At 13:07 GMT, the Italian Retail Sales for the month of March showed a decline of 20.5% against the forecasted decline by 14.95 and weighed on EUR. EUR/USD - Daily Technical Levels Support Resistance 1.0789 1.0858 1.0743 1.0881 1.072 1.0927 Pivot Point 1.0812 EUR/USD – Daily Forecast The EUR/USD is trading at 1.0830, having violated the intraday pivot point resistance level of 1.0812. A bearish breakout of 1.0812 level can lead the EUR/USD prices towards 1.07630, which marks 78.6% Fibonacci level. Below this, the next support stays around 1.0725. On the higher side, resistance holds around 1.0864. The RSI is holding below 50, which is keeping the EUR/USD in a bearish mode while the 50 EMA is also suggesting odds of selling trend in the EUR/USD. Consider staying bearish below 1.0808 today. The GBP/USD pair was closed at 1.23614 after placing a high of 1.2418 and a low of 1.22658. Overall the movement of pair remained bullish throughout the day. British Pound after falling for the past four days posted gains on Thursday amid the Bank of England's monetary policy statement. Bank of England maintained its Interest Rates at the same level of 0.1% on Thursday and continued its bond-buying program worth two hundred billion Pounds. In its Monetary Policy Meeting report of May, it also revealed a depressing outlook for the United Kingdom's economy. The Bank of England has hinted that the U.K. economy was moving towards its sharpest recession on record. It also expected the U.K.'s economy to shrink by 14% this year and the unemployment rate to be doubled by 9% during the second quarter. The expectations by BoE for the U.K.'s economy if the meeting would make it the biggest slum of the nation since 1706 when the nation has seen a 15.3% contraction in the economy at the time of The War of Spanish Succession. It also should be noted here that in the 2019 financial crisis due to the U.S. & China trade war, the U.K. economy faces a contraction of 4.2%. On Thursday, the GBP/USD pair rose on the back of the pledge BoE took to handle the coronavirus crisis and to take action to recover its economy. However, given the projected GDP fall and outlook of the economy by BoE, the GBP/USD pair is likely to remain under pressure in the coming days. Support Resistance 1.228 1.2433 1.2197 1.2501 1.2128 1.2585 Pivot Point 1.2349 The GBP/USD is entering into a selling zone below 50 EMA resistance at 1.2450 and under the pivot point level of 1.2376. On the 4-hour timeframe, the GBP/USD has violated the intraday pivot point support level of 1.2349, which is now weighing on the Cable. On the lower side, the Cable is likely to find support around 1.2279 and 1.2207. Considering the RSI and 50 EMA are suggesting chances of selling bias today. On the higher side, the GBP/USD prices are likely to find resistance around 1.2470 and 1.2515. Let's look for selling trades below 1.2427 today. Good luck!