EUR/USD – Buy: The EUR/USD pair is showing significant growth, developing the strong bullish momentum formed at the end of last week. This momentum has enabled the pair to recover from the July 3 low to the July 18 high within just a few hours. Currently, it is attempting to break through the 1.0940 level. The sharp weakening of the US dollar is due to US macroeconomic data, increasing concerns about a global economic downturn. The July employment report showed that nonfarm payrolls dropped sharply from 179,000 to 114,000, significantly below the market forecast of 175,000. As a result, the probability of the Federal Reserve lowering interest rates by September is estimated at 80.0%. Investors are focused on today’s release of the S&P Global Services PMI statistics for the Eurozone and the US. Additionally, the Eurozone Producer Price Index (PPI) is expected to show a slight increase on a monthly basis.
GBP/USD – Buy: The GBP/USD pair remains relatively stable around 1.2800 following the release of the US June employment report at the end of last week. Nonfarm payrolls dropped sharply from 179,000 to 114,000, falling short of the forecast of 175,000. Consequently, there is an 80.0% probability of a 25 basis point rate cut in September. In the UK, the Bank of England lowered the interest rate by 25 basis points last week, suggesting further easing if the economic situation improves. Today’s focus will be on the S&P Global Services PMI statistics.
NZD/USD – Buy: The NZD/USD pair is testing the 0.5930 level, reflecting a decline from the local high on July 22. The US July employment report showed a significant decrease in nonfarm payrolls from 179,000 to 114,000, well below the forecast of 175,000. This has led to an 80.0% probability of a 25 basis point rate cut in September. The New Zealand dollar is also supported by the Caixin Services PMI in China, which rose from 51.2 points to 52.1 points.
USD/JPY – Buy: The USD/JPY pair is developing a short-term bearish trend, testing the year-to-date low of 142.60. The Bank of Japan’s decision to raise interest rates indicates a higher inflation risk, suggesting the possibility of further policy changes. The US employment report showed a significant decrease in nonfarm payrolls from 179,000 to 114,000, with an 80.0% chance of a 25 basis point rate cut in September.
Gold/USD (XAU/USD) – Strong Sell: The Gold/USD pair is trading steadily around 2450.00. The US employment report released at the end of last week showed a significant decrease in nonfarm payrolls from 179,000 to 114,000, increasing the likelihood of the Federal Reserve moving towards monetary easing soon. Furthermore, heightened tensions in the Middle East, with Hamas leaders killed by Israeli missile attacks and Iran vowing retaliation, are supporting gold prices due to geopolitical risks.
