USD remains up

(Jing Ren – Orbex)

NZD/USD continues lower

The New Zealand dollar softens as risk appetite continues to subside. A bearish MA cross on the daily chart points to an acceleration to the downside. A short-lived bounce to 0.6190 indicates strong headwinds. The bulls would need to reclaim 0.6250 before a sustained recovery could materialise. Otherwise, 0.6060 at July’s low is a critical floor and its breach could trigger a bearish continuation, sending the pair towards the psychological level of 0.6000. 0.6110 is the first resistance where trend followers may look to sell.

EUR/JPY breaks higher

The euro struggles over weaker manufacturing activity across the bloc. A bullish MA cross on the daily chart suggests an improvement in sentiment after the pair bounced off 133.50. The price has consolidated its latest gains after clearing the supply zone around 138.30 and the latter has become a fresh support. The psychological level of 140.00 caused some profit-taking but the directional bias remains up and could attract more follow-ups. July’s high at 142.20 could be the next target when momentum picks up again.

Nasdaq 100 grinds critical support

The Nasdaq 100 falters as the Fed puts price stability as its number one priority. A drop below 13000 has prompted buyers to bail out, exacerbating the selling pressure. The index is hovering above 12000 at the base of a bullish breakout in late July. This is a critical zone to hold the fading optimism together. A bearish breakout would show a lack of commitment from the buy side and turn the previous rally into a dead cat bounce. An oversold RSI attracted some buying interest in the demand zone and 12500 is a fresh resistance.

US Dollar Index outlook: Dollar is consolidating under new two-decade high ahead of US jobs data

(Slobodan Drvenica – Windsor Brokers)

The dollar keeps firm tone and holding near new two-decade high in early Friday’s trading, after solid US manufacturing data on Thursday added to overall bullish stance.

The greenback remains well supported by risk aversion on growing uncertainty in global economy and expectations for further rate hikes, after Fed chair Powell confirmed the central bank’s strong commitment to restore the price stability and said that interest rates would need to be high for some time until the Fed reaches its target.

The most of market participants bets for another 0.75% rate hike later this months, after Powell made it clear that slowdown in economic growth, due to rising interest rates, would not derail the Fed from its fight against high inflation.

Markets await today’s release of August labor report, with expectations for 300K new jobs added last month, compared to 528K in July, is still seen as solid figure which would add to Fed’s hawkish stance, while only significant fall below expectations would soften the tone and dent expectations for another aggressive action in the policy meeting in September.

Fresh acceleration on Thursday hit new highest in twenty years, just ticks below psychological 110 barrier, break of which would signal bullish continuation and expose next target at 112.04 (June 2002 high), though bulls can accelerate further in supportive environment.

The dollar index entered September in bullish mode, following 2.6% monthly advance in August and is also on track for the third consecutive bullish weekly close.

Dips are so far expected to be shallow and offer better buying opportunities, with daily Tenkan-sen (108.71) to ideally contain and keep the downside protected.

Caution on scenario of disappointing US NFP numbers that would deflate bulls for deeper pullback.

Res: 110.00; 110.22; 110.90; 111.44.
Sup: 109.12; 108.71; 108.21; 107.87.