Market Analysis: The Dollar Remains Under Pressure

FXOpen

EUR/USD

The EUR/USD pair shows mixed trading dynamics, holding near the 1.0550 mark. Last week, the single currency managed to strengthen slightly despite the fact that the pair updated record lows since December 7, 2022. The reason for the weakening of the American currency was mainly technical factors, while the news background changed slightly. Trading participants are once again discussing the prospects for a possible tightening of monetary policy by the US Federal Reserve, adjusting their forecasts after the publication of a report on the American labour market on Friday. Thus, in September, the national economy created 336.0k new jobs after 227.0k in the previous month, while analysts expected 170.0k, and the unemployment rate remained at 3.8% with a forecast of 3.7%. Average hourly wages added 0.2% in monthly terms, while experts expected 0.3%, and in annual terms, the figure slowed from 4.3% to 4.2% with neutral forecasts.

This week, the market will focus on September statistics on consumer inflation in the US, which will be published on Thursday. Analyst forecasts suggest a slowdown in price growth from 0.6% to 0.3%. Market activity is likely to remain moderate today as US stock exchanges are closed for Columbus Day. In turn, the EU will present August statistics on industrial production in Germany, as well as data on the Eurozone Investor Confidence Index from Sentix for October, which was recorded at -21.5 points a month earlier.

Based on the highs of two days, a new ascending channel has formed. Now, the price has moved away from the upper border of the channel and may continue to move towards the lower border.

GBP/USD

The GBP/USD pair is holding near the 1.2200 mark amid the weekend in the US and Canadian markets. At the same time, trading participants continue to evaluate the September report on the American labour market, published on Friday, trying to predict the vector of the future monetary policy of the US Federal Reserve. After the publication of the data, the market revised its forecasts for a further increase in borrowing costs by the American regulator until the end of this year. Now, about 42.0% of analysts are in favour of adjusting the interest rate by 25 basis points, while on Thursday, the probability of such an outcome was estimated at 35.0%. At the same time, experts also expect that in 2024, the department will launch a rate reduction program somewhat later.

In turn, macroeconomic data from the UK, presented on Friday, had virtually no impact on the dynamics of the pair. Thus, the Halifax housing price index in September decreased by 0.4% after -1.8% a month earlier with a forecast of -0.8%, and in quarterly terms, the indicator decreased by 4.7% after -4.5%.

Based on the highs of two days, a new ascending channel has formed. Now, the price has moved away from the upper border of the channel and may continue to move towards the lower border.

USD/JPY

The USD/JPY pair shows slight growth, remaining close to 149.15. Last week, it showed the development of a moderate correction, retreating from the psychological barrier at 150.00. At the same time, on Friday, the US dollar tried to return to growth, reacting to the publication of the September report on the American labour market.

Meanwhile, macroeconomic statistics from Japan provided minor support to the yen. Thus, the Coincident Index in August rose from 114.2 points to 114.3 points, and the index of leading indicators, from 108.2 points to 109.5 points, exceeding forecasts of 109.0 points. At the same time, household spending in August decreased by 2.5% after -5.0% a month earlier, while analysts expected -4.3%, and the average wage remained at 1.1%, while experts expected 1.5%.

Based on the lows of two days, a new downward channel has formed. Now, the price is near the upper border of the channel, from where it could continue to decline.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

Market Analysis: AUD/USD and NZD/USD Set Sights on Additional Upside The US Dollar Is Weakening Following Inflation Data Dollar Adjusts After the Publication of Inflation Data in the US Market Analysis: EUR/USD Sees Green as USD/JPY Gains Bullish Traction GBP/USD Analysis: Pound Recovers After the Bank of England Decision

Latest articles

Financial Market News

Weekly Market Wrap With Gary Thomson: S&P500, US Dollar, Gold Price, PEP Stocks

Get he latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights. Read the latest news

Commodities

The Price of Silver Has Reached Its Highest Level in Over Three Years

As indicated by the XAG/USD chart today, the intraday price of silver reached $29.84 per ounce yesterday, while the previous yearly high on 12 April was $29.79. The last time this price was seen was in February

What Is the Wolfe Wave, and How Can You Trade It?
Trader’s Tools

What Is the Wolfe Wave, and How Can You Trade It?

The Wolfe Waves is a powerful chart pattern recognised for analysing potential price reversals. Named after Bill Wolfe, who developed this formation through extensive trading practice, Wolfe Waves provide traders with a structured approach to anticipate market movements. In this

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.