The USD is on the rise following S&P global and existing home sales data that exceeded expectations. This has reduced the chance of a September rate cut to 75%, down from last week’s 100%. Fed Chair Powell is set to speak tomorrow, with September data remaining vital prior to the mid-month rate decision. Despite pressures to cut rates, weak jobs data, and a dual focus, a full rate cut seems unlikely.<\/p>\n
EURUSD reached a new low, entering the 1.16098 to 1.16309 swing area. The 50% retracement level at 1.16098 is a key downside target. On the upside, resistance was encountered at 1.1661, halting further gains. A decisive move below the 1.16098 level would indicate increased seller control, suggesting deeper retracement potential.<\/p>\n
For GBPUSD, focus is on nearing the 100-day moving average at 1.34078. Earlier, it extended to 1.3436 before rebounding above the 50% midpoint at 1.3463, peaking at 1.3481 before falling back. Key price levels are shaping current momentum.<\/p>\n
USDJPY experienced a strong recovery today, reclaiming levels above 147.50. This push extended into the swing area resistance at 147.95 to 148.166. Breaking above 148.166 would signify a bullish move, offering potential for increased upward momentum in coming sessions.<\/p>\n
The strong US dollar is being driven by solid economic data, which should guide our trading strategies. The S&P Global Composite PMI for August registered a 51.5, beating expectations, and July’s existing home sales came in at an annualized rate of 4.25 million, also ahead of forecasts. This has caused the market, as measured by the CME FedWatch Tool, to lower the probability of a September Fed rate cut from a certainty last week to just 75% today.<\/p>\n
We should not expect Fed Chair Powell to signal a definite rate cut in his speech tomorrow. The weaker July jobs report, which showed only 155,000 new jobs, will be mentioned, but he will likely stress that future decisions depend on incoming data before the mid-September meeting. This cautious stance is similar to what we saw in 2019, when the Fed began an easing cycle but proceeded very slowly amid conflicting economic signals.<\/p>\n
For EURUSD, the path of least resistance is lower, especially with recent data showing a 0.5% contraction in German industrial production, weighing on the Euro. Derivative traders should view the 1.16098 level as a critical line in the sand. A sustained break below this point could be a trigger for buying put options to capitalize on a potential slide toward the August 1 lows.<\/p>\n
The outlook for GBPUSD is also bearish as it approaches its 100-day moving average near 1.3407. Recent UK data has been unhelpful, with stubbornly high inflation and falling retail sales creating a difficult economic picture. A failure to hold this key moving average would signal increasing seller control and suggest that bearish positions are warranted.<\/p>\n
In contrast, we see continued strength in USDJPY due to the widening interest rate gap between the US and Japan, where the Bank of Japan remains committed to its accommodative policy. The key is whether the pair can break and hold above the 148.166 resistance area, which it has tested four times in the last seven sessions. A decisive move above this level would be a strong signal to consider buying call options, anticipating a run toward higher targets.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" USD strengthens as data beats forecasts; EURUSD and GBPUSD test key levels; USDJPY shows bullish momentum.<\/p>\n","protected":false},"author":62,"featured_media":16964,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-29449","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/29449","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=29449"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/29449\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/16964"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=29449"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=29449"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=29449"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}