Forex Signals Brief August 15: US Retail Sales and Jobless Claims

Today markets will be focused on the US retail sales to see the shape of the economy, but also on unemployment claims regarding labour mark

Skerdian Meta•Thursday, August 15, 2024•3 min read

Yesterday began with a 25 bps rate cut from the RBNZ, causing the NZD to drop nearly 1 cent, with NZD/USD ending the day at 0.60. The housing sector, facing potential downward pressure, was the primary contributor to the slight inflation in the CPI report, which came in slightly below expectations.

All Eyes on the US Unemployment Claims Report

In the past, such news would have sparked a significant market reaction, but this time the response was surprisingly muted, likely due to anticipation of the data following Tuesday’s PPI. The initial market movement was driven by the PPI report, leading to bond sell-offs and a stronger USD.

However, there wasn’t much selling apart from GOLD which dived $40, with the focus shifting to buying stocks and bonds, while the US dollar underperformed overall. After the report, USD/JPY fluctuated within a 100-pip range, initially dropping by 50 pips before gradually recovering all losses and rising again in the late afternoon. Oil prices reversed all weekly gains, though evidence of this remains limited.

Today’s Market Expectations

RBNZ Governor Orr’s comments overnight did not offer much optimism for the Kiwi, though the impact on the currency was minimal. He said that, Trimming monetary policy restraint is appropriate now, with caution advised in adjusting interest rates. Inflation is moving in the right direction, though the current economic environment is weaker than anticipated six months ago.

The US Retail Sales M/M is expected to rise by 0.3%, up from 0.0% previously, while the Ex-Autos M/M measure is projected to slow to 0.1% from 0.4%. The Control Group M/M is anticipated to be 0.2%, down from 0.9% earlier, suggesting that overall consumer spending remains steady despite some softening.

The US Jobless Claims report continues to be a key indicator of the labor market’s health. Initial claims have remained within the 200K–260K range since 2022, reflecting stable layoff levels and more restrained hiring. This week, initial claims are expected to increase slightly to 236K, up from 233K last week, while continuing claims are projected to be 1,871K, just below the previous 1,875K.

Yesterday the price action slow, with the price action in markets being calm, but the volatility picked up during the day as sentiment improved and stocks and risk assets making some decent gains. We opened four trading signals, remaining mostly long on stock indices, and ended up with three winning trading signals and one losing signal.

Gold Fails at Record High Again

Gold remains unable to surpass its record high of $2,483.74, with today’s peak falling short at just under $2,480. The metal has dropped by over 2% today after a third unsuccessful attempt to break through the $2,480 level. Although gold is still up for the week, having surged $50 on Monday, it has since pulled back, failing to surpass the July highs. This retreat is largely attributed to the market scaling back expectations for Federal Reserve rate cuts. Chart XAUUSD, H4, 2024.08.15 01:13 UTC, MetaQuotes Ltd., MetaTrader 5, Demo

XAU/USD – Daily chart

GBP/USD Reaches the 20 SMA After Bouncing Off the 100 SMA

The highlight of yesterday’s European session was the release of the UK jobs report, which supported the GBPUSD rise despite lower earnings. Despite persistent doubts about the accuracy of the data, it showed a notable decline in the unemployment rate. The stronger-than-expected unemployment rate and increased appetite for market risk have propelled the GBP/USD pair higher. As of now, the pair is up 0.7% on the day, trading at the 1.2870 level. Chart GBPUSD, D1, 2024.08.13 22:23 UTC, MetaQuotes Ltd., MetaTrader 5, Demo

GBP/USD – Daily Chart

Cryptocurrency Update

Bitcoin Fails at MAs

Bitcoin’s price weakened again this morning amid ongoing geopolitical tensions and a cautious risk environment. Cryptocurrency investors were further discouraged by a conversation on X (formerly Twitter) between Republican presidential candidate Donald Trump and Tesla CEO Elon Musk, which made no mention of cryptocurrency regulations. Although Trump has expressed support for the cryptocurrency sector, even speaking at a recent conference, he has rarely addressed the issue in broader forums. Following this interview, Bitcoin briefly dipped below $58,000, but as risk sentiment improved during the U.S. session, it climbed back toward $61,000.

BTC/USD – Daily chart

Ethereum Consolidating Above $2,500

Ethereum has been showing a pattern of lower highs since March, indicating a potential downturn in August. After peaking at $3,830, Ethereum’s price fell below $3,000 in June. Although buyers managed to push the price above the 50-day SMA, recent selling pressure led to another bearish reversal. As a result, Ethereum’s downward trend persisted, with the price dropping below the 200-day SMA. Yesterday, Ethereum briefly fell to $2,000 before rebounding to $2,400.

ETH/USD – Daily chart

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.