Forex Signals Brief Feb 5: Can the USD Bull Run Continue As US Jobs Surge?
Last week we had everything, from a flash banking crisis to hawkish central banks, to end with an amazing NFP report on Friday. We saw some positive signals from the US on Monday when the JOLTS job openings jumped higher, as did the CB consumer confidence. The ADP employment number missed expectations, but that’s not a major indicator, in a week when the FOMC and the NFP are on the way.
The FOMC meeting took place on Wednesday, followed by the Bank of England meeting on Thursday, both of which leaned on the hawkish side, pushing rate cuts further toward May with their rhetoric. That turned the USD bullish that day, as the odds of a March cut declined considerably.
But, the sentiment turned negative for the USD on Thursday, as the shadows of last year’s regional banking crisis returned. Stocks of many other mid-sized lenders, after New York Community Bancorp slashed its dividend, sending shivers through the banking sector. However, on Friday we saw a turnaround in the USD sentiment after an amazing NFP (Non-Farm Payrolls) report which showed 353K new jobs, which is much higher than the 180K estimated, with earnings also jumping higher as employers hike wages after 2 years of massive inflation.
This Week’s Market Expectations
This week is unlikely to provide the volatility that we saw last week. However we have the Reserve Bank of Australia tomorrow and besides that, we should keep an eye on how the situation in the US regional banking/lending sector will evolve from here, because if it persists, the USD will likely crash lower again.
This Week’s Calendar Events
Monday:
- China January Caixin Services PMI
- Eurozone January PPI inflation
- Canada December Services PMI
- US January ISM Services PMI
Tuesday:
- Japan January Wage Data
- RBA Monetary Policy Decision
- Eurozone January Retail Sales
Wednesday:
- Switzerland’s January Unemployment Rate
Thursday:
- China CPI Inflation Report
- US unemployment Claims
Friday:
- US Annual CPI Revision
- Canada Employment Report
BTC/USD – Daily Chart
Ethereum Can’t Hold Gains Above $2,300
ETHEREUM has also been negative, sliding from above $2,700 since the debut of BTC ETFs, although the general trend remains favorable because it has yet to reach lower lows. The price fell below the 20 daily SMA (gray) yesterday, but it remains above the 50 SMA (yellow), which serves as the last support indicator during deeper pullbacks such as this one. We’re trying to develop another long-term buy ETH signal near the 50 SMA, but we’ll see how the price action unfolds.
Ethereum – Daily Chart
- ETH Buy Signal
- Entry Price: $2,290
- Stop Loss: $2,590
- Take Profit: $1,750
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