Intraday Technical Analysis 04 February

The U.S. Dollar recovered on Friday as the economic data was broadly positive. The monthly payrolls report showed that the average hourly earnings rose at a slower pace of 0.1%. However, on a year over year basis, average hourly earnings grew 3.2%. The U.S. unemployment rate rose to 4.0% which was higher than the forecasts of 3.9%.

The economy added 304k jobs during January which beat estimates by a substantial margin. There was a net 70k downward revision for November and December.

Construction spending data showed a 0.8% increase on the month which showed an acceleration from the month before as it beat estimates of 0.2% increase.

The ISM manufacturing PMI data showed an increase to 56.6 on the index. This was higher than the month before and beat estimates of a 54.1 reading.

Earlier in the day, data from the Eurozone showed that the inflation estimates for January fell. Headline CPI increased by 1.4% on the year while core CPI posted a modest increase to 1.1% on the year.

The Eurozone’s manufacturing PMI came in at 50.5 matching estimates and unchanged from the month before.

Looking ahead, the economic data on the day will see the release of the U.S. factory orders report. Economists forecast a modest pick up of 0.3% on the month after factory orders fell 2.1% in the month before.

The Eurozone’s sentix investor confidence will be coming out with forecasts showing a modest improvement on the index to -1.1.

EURUSD Intraday Analysis

EURUSD (1.1453): The EURUSD currency pair drifted sideways after a brief intraday rally saw prices attempting to push higher. The euro currency closed almost flat on the day on Friday. The declines came off the highs after price action tested the long term falling trend line before giving up the gains. The price action in the EURUSD remains trading flat within the broader range of 1.1575 and 1.1218 levels of resistance and support respectively.

AUDUSD Intraday Analysis

AUDUSD (0.7241): The AUDUSD currency attempted to test the previous highs established near the upper resistance level of 0.7292. The AUD posted a modest high near the resistance level before closing weaker. The range within 0.7292 a 0.7191 remains likely to be maintained in the near term. In the short term, the lower support at 0.7191 could be tested in the near term. A close below this support will potentially extend the declines toward 0.7022.

XAUUSD Intraday Analysis

XAUUSD (1315.07): Gold prices consolidated after posting strong gains near the highs. Price action stalled near the highs of 1321 before easing lower. The overall increases stalled near the main resistance level area of 1321 and 1315 level. The daily chart also signals a hidden bearish divergence near these highs indicating a potential move to the downside. However, for the short term, gold prices are likely to remain range bound within the said levels. A close below 1315 is required for gold prices to break down lower to test the 1280 support.