Spreads
Spreads
Spreads
Spreads
Spreads
(All data taken from MT4 VT Markets)
This week, investors will pay special attention to Friday’s release of US nonfarm payrolls data for May, with expected strong showings in the labour market.
Economists are forecasting the economy added 320,000 jobs in May, a decrease from April’s addition of 428,000 jobs — the weakest increase in employment in a year. As a result of labour shortage, it is anticipated that wage growth will continue to be robust, and unemployment rate will decline to 3.5%.
The Bank of Canada (BoC) is projected to follow an aggressive path to tame soaring inflation, which hit a 3-decade high of 6.8% in April, way above the central bank’s 1-3% range.
After April’s 50bps hike, its biggest single hike in more than 2 decades, BoC Governor Tiff Macklem said interest rates may need to go above the neutral range for some time to get inflation back on target. The BoC is likely to raise its overnight rate by another half a percentage point at its June 1 meeting, taking its official cash rate to 1.50%.
In view of worries regarding the impact of rising prices and supply chain challenges, ISM statistics on manufacturing and service sector activities will also be in the spotlight.
June kicks off with Australia’s Q1 GDP report on Wednesday.
The USD index (USDX) fell again last week and managed to break our immediate support at 102.46.
This week, we see the potential for USDX to continue weakening to pursue the 101.10 level before waiting for the results of the nonfarm data on Friday.
The support level in the next weekly timeframe is at the 99.78-100.26 range, while the resistance level is again at the 102.68-103.20 area, with the highest resistance at 104.65.
Meanwhile, on the 4-hour timeframe, the closest support level is 101.50, and the resistance level is 102.35.
Resistance: 102.35, area 102.68-103.20
Support: 101.50, 101.10, area 99.78-100.26
Last week, Gold was flat between $1831 and $1877, and failed to break through both levels.
This week, there is a possibility that Gold will try to rise again through $1877, likely dependent on Friday’s nonfarm data.
On the weekly timeframe, the closest resistance levels are at $1854 and $1877, with support levels at $1831 and $1782.
On the 4-hour timeframe, the closest support is at $1832-$1836, with resistance at $1858-$1861.
Resistance: area $1858-$1861, $1877
Support: area $1832-$1836, $1782