• Major currencies subdued awaiting US jobs report
• ECB’s Villeroy: Our options are open at the next and upcoming rate meetings
• ECB’s Vujčić: We won’t know in Sept, October or even November where the terminal rate is
• BOE’s Pill: We have not seen a downturn in core inflation which would reassure us
• RBA to keep cash rate unchanged next week – poll
• China reportedly to take more action in order to try and revive property sector
• Eurozone August final manufacturing PMI 43.5 vs 43.7 prelim
• UK August final manufacturing PMI 43.0 vs 42.5 prelim
• UK August Nationwide house prices -0.8% vs -0.2% m/m prior
• Switzerland August CPI +1.6% vs +1.5% y/y expected
• Italy Q2 final GDP -0.4% vs -0.3% q/q prelim

Markets:

• JPY leads, AUD lags on the day
• European equities higher; S&P 500 futures up 0.4%
• US 10-year yields up 0.6 bps to 4.096%
• Gold up 0.2% to $1,943.79
• WTI crude up 1.1% to $84.53
• Bitcoin up 0.1% to $26,050

It was a quiet session for FX as traders are waiting on the US non-farm payrolls later today before firming up their convictions.

The dollar is steady across the board as narrow ranges prevailed during the session and in general, is trading little changed across the board now. The bond market was also in a similar mood, with traders keeping their attention on the jobs report to come.

Equities did nudge a little higher though, gradually advancing during the session. However, I’d argue the gains are tentative as investors are holding out some hopeful optimism – which may end up being dashed by the key risk event later today.

In terms of data, we got manufacturing PMIs which just solidified the notion that factory activity in the euro area continues to be stuck in a rut. And that downturn isn’t improving well enough to suggest a change in the worsening outlook ahead of Q4.

Welp. Now over to the much awaited non-farm payrolls data before the long weekend in the US.

This article was written by Justin Low at www.forexlive.com.

• 34 of 36 economists see the RBA leaving the cash rate unchanged next week
• 21 of 35 economists see the RBA hiking to 4.35% or higher by year-end
• The remaining 14 economists forecast no more rate hikes for the year

Among Australia’s „big four“, ANZ, CBA, and Westpac are not seeing any more rate hikes by the RBA for this year while NAB is the only one forecasting one more rate hike to 4.35% in November.

This article was written by Justin Low at www.forexlive.com.

US:

• The Fed hiked by 25 bps as
  expected and kept everything unchanged at the last meeting.
• Inflation expectations and CPI readings continue to
  show disinflation with the last two Core CPI M/M figures
  coming in at 0.16%.
• The US PMIs missed
  expectations across the board last week.
• Fed Chair Powell’s speech at the Jackson Hole Symposium was
  mostly in line with what he said previously but he stressed on the need to be
  careful going forward and that continued strength in the labour market may
  require further rate hikes.
• ·The first half of the week saw US Job Openings and Consumer Confidence reports
  missing expectations by a big margin, followed by a miss in the US ADP data and
  a beat in the US Jobless Claims.
• The market doesn’t expect another hike from the Fed
  anymore, but a lot will depend on the data going forward.

New Zealand:

• The RBNZ kept its official cash rate unchanged while
  stating that it will remain at the restrictive level for the foreseeable future
  to ensure that inflation comes down back to target.
• The recent New Zealand inflation and employment data surprised to the upside but
  the PMIs are in contraction with the Services PMI last week plunging into
  contraction.
• The wage growth has also missed
  expectations and it’s something that the central banks are watching closely for
  second round effects.
• The New Zealand Retail Sales beat expectations although remain
  deeply negative.
• The RBNZ is expected to keep the
  cash rate steady at the next meeting.

NZDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that NZDUSD is
testing the key resistance at
0.5987 where we can also find the red 21 moving average for confluence. This is
where the sellers are likely to pile in with a defined risk above the
resistance to target another lower low. The buyers, on the other hand, will
want to see the price breaking higher to invalidate the bearish setup and
target the first swing high around 0.61handle.

NZDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we’ve been diverging with the
MACD for a
long time and this is generally a sign of weakening momentum often followed by
pullbacks or reversals. In this case, the break of the trendline raises
the chances of a reversal with the 0.6117 level being the first target, but the
buyers will need the price to break above the 0.5987 resistance to confirm the
reversal.

NZDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that we
have a small range between the 0.5987 resistance and the 0.5930 support. A
breakout on either side should lead to a sustained and strong move and today’s
economic data might be the catalyst.

Upcoming Events

Today the market will
be focused on the main release of the week: the US NFP report. We will also
have the US ISM Manufacturing PMI an hour and a half later, but the labour
market data is the priority right now. A bad reading is likely to weaken the US
Dollar in the short term, but if the data is really bad, the market may start
to fear the recession and the greenback should come back soon after. A good
reading is likely to be linked with the soft-landing scenario and might be
bearish for the USD as well. Overall, it’s a mixed picture at the moment as the
Fed is expected to pause at the September meeting and we might get much worse
economic data before the next meeting in November.

This article was written by FL Contributors at www.forexlive.com.

• Need to be particularly wary about letting an inflation persistence dynamic set in

The BOE still needs to hike rates again, so the headline remark definitely sides with that. The OIS market is pricing in ~76% odds of a 25 bps rate hike for later this month currently.

This article was written by Justin Low at www.forexlive.com.

• Economic activity is slowing faster than we forecast
• Softening of economy may help bring down inflation faster
• But labour market resilience still an upside risk to inflation

At this point, it sure looks like they are leaning towards a pause but want to keep the door open to perhaps tighten policy again later on if need be. But the thing is, the economic deterioration in the euro area is going to make the case for rate hikes down the road extremely difficult. A rock and a hard place.

This article was written by Justin Low at www.forexlive.com.

Cardano
(ADA) is a popular cryptocurrency that has gained significant attention in the
digital asset market. Its price is influenced by various factors that impact
its demand and supply dynamics, regulatory developments, competition from other
cryptocurrencies, adoption by major institutions and technological
advancements.

Market Demand and Supply

The
price of Cardano is heavily influenced by market demand and supply. The Cardano price tends to increase
when there is high demand for ADA tokens and vice versa. Factors such as
investor sentiment, market speculation and overall market conditions play a crucial
role in determining the demand for Cardano. Additionally, the supply of ADA
tokens, which is limited, also affects its price. As the supply decreases, the
scarcity of the tokens can drive up the price.

Regulatory Developments

Regulatory
developments have a significant impact on the price of Cardano. Government
regulations and policies regarding cryptocurrencies can either boost or hinder
their adoption and use. Positive regulatory developments, such as recognizing
Cardano by regulatory authorities or implementing favorable regulations, can
increase investor confidence and drive up the price. On the other hand,
negative regulatory news or strict regulations can lead to a decline in price.

Competition from Other Cryptocurrencies

Cardano
faces competition from other cryptocurrencies in the market. The performance
and popularity of competing cryptocurrencies can influence the demand for
Cardano. If a new cryptocurrency emerges with innovative features or gains
significant adoption, it may divert investor attention and funds away from
Cardano, potentially impacting its price negatively. Monitoring the competitive
landscape is crucial to understanding Cardano’s price movements.

Adoption by Major Institutions

The
adoption of Cardano by major institutions can positively impact its price. When
renowned companies, financial institutions, or governments announce
partnerships or initiatives involving Cardano, it increases its credibility and
attracts more investors. Institutional adoption brings liquidity and stability
to the market, which can drive up the price of Cardano. News of partnerships,
collaborations, or integrations should be closely monitored for potential price
movements.

Technological Advancements

Technological
advancements and developments within the Cardano ecosystem can influence its
price. Cardano’s blockchain platform is known for its focus on security,
scalability and sustainability. Upgrades, new features, or successful
implementation of technological advancements can
enhance the utility and value of Cardano, attracting more users and investors.
Positive technological developments often lead to an increase in price.

In
conclusion, Cardano’s price is influenced by various factors, including market
demand and supply, regulatory developments, competition from other
cryptocurrencies, adoption by major institutions and technological advancements.
Understanding these factors and staying updated with the latest news and
developments is crucial for investors and traders navigating the Cardano
market.

This article was written by FL Contributors at www.forexlive.com.

This
first half of the week was highlighted by big misses in the US economic data
like Job Openings, Consumer Confidence and ADP. These
might be the first signs that a recession is indeed on the horizon as the
labour market is starting to show weakness. In fact, the market is no longer
seeing the Fed hiking interest rates as the September and November
probabilities dropped further and the rate cut expectations were brought
forward. Nonetheless, despite the worrying data, the Nasdaq Composite rallied
strongly as if nothing bad happened at all. There could be different reasons
that range from a relief rally due to dovish expectations and lower yields or
the market interpreting the softer labour market readings as good news for
inflation going forward. Until we see more data, the technicals will help in
managing the risk and in identifying the most probable market directions.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite has bounced strongly from the key 13174 support and
rallied all the way back to test the broken trendline. Will
this be a classic “break and retest” move? There isn’t much to lean on for the
sellers except the trendline, and the moving averages are
crossing back to the upside which might be a bullish signal.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we have also
the 61.8% Fibonacci retracement level
around the trendline that can give the sellers some structure to position for a
move lower. In fact, if the price falls below the Fibonacci level, the sellers
are likely to pile in with a defined risk above the trendline and target a
break below the 13174 support.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the resistance zone formed by the previous support now turned
resistance, the broken trendline and the 61.8%
Fibonacci retracement level. We can also see that we might be forming a bearish flag
pattern, but the price will need to break below the bottom trendline to confirm
it. In any case, a break below the steep trendline will give the sellers more
conviction for a downside move, while the buyers will want to see the price
breaking higher to keep targeting the highs.

Upcoming
Events

This week is all about the US labour market data and the
recent releases haven’t been encouraging on a forward-looking basis. Today, the
main event will be the US Jobless Claims report accompanied by the US PCE data.
Tomorrow, we conclude the week with the US NFP and ISM Manufacturing PMI
reports. It’s hard to see the Nasdaq Composite climbing even if the data misses
as the signals for a recession are accumulating, but the stock market always
finds ways to surprise even in the face of economic problems.

This article was written by FL Contributors at www.forexlive.com.

• Members concurred that there was ample evidence that policy tightening was being transmitted strongly to broader financing conditions, including bank lending rates and money and credit flows
• It was felt, however, that, on the one hand, the decline in economic activity was less significant than could have been expected in reaction to the substantial monetary policy tightening over the past few months
• Members agreed that tightening the monetary policy stance by further increasing interest rates was warranted
• Members generally concurred that inflation developments had been broadly in line with the June projections
• Members concurred that the outlook for economic growth remained highly uncertain
• A question was raised about the extent to which the deterioration in the short-term growth outlook was related to the ECB’s monetary policy tightening
• It was argued that the deterioration in the outlook showed that monetary transmission was working and that the interest rate increases were doing their intended job
• Full accounts

At first glance, there doesn’t seem to be anything new to add to the debate on September. The ECB is continuing to maintain that the hit to credit conditions is largely evidence that monetary policy transmission is working but they have to be careful not to overdo it and bring about a real and more serious credit crunch in the economy.

This article was written by Justin Low at www.forexlive.com.

Job cuts are seen reaccelerating again after showing a first year-on-year decrease in July. And that further signals easing of labour market conditions with there being 557,057 job cuts already announced by US-based employers this year. That is a 210% increase from the 179,506 job cuts announced in the same period last year. And to put things into context, this is the 3rd highest year-to-date total since 2009.

This article was written by Justin Low at www.forexlive.com.

US:

• The Fed hiked by 25 bps as
  expected and kept everything unchanged.
• Fed Chair Powell reaffirmed their data dependency
  and kept all the options on the table.
• Inflation expectations and CPI readings continue to
  show disinflation with the last two Core CPI M/M figures
  coming in at 0.16%.
• The US PMIs missed
  expectations across the board last week, while the US Jobless Claims remained
  solid.
• Fed Chair Powell’s speech at the Jackson Hole Symposium was
  mostly in line with what he said previously but he stressed on the need to be
  careful going forward and that continued strength in the labour market may
  require further rate hikes.
• The first half of the week saw US Job Openings and Consumer Confidence reports
  missing expectations by a big margin, followed by a miss in the US ADP data
  yesterday.
• The market doesn’t expect another hike from the Fed
  anymore, but a lot will depend on the data going forward.

EU:

• The ECB hiked by 25 bps and
  changed a line in the statement that leant more on the dovish side.
• President Lagarde didn’t hint to what we can expect
  next and, in line with the Fed, just reaffirmed their data dependency and kept
  all the options on the table.
• The Eurozone PMIs missed
  expectations across the board with the Services sector plunging in contraction.
• President Lagarde at the Jackson Hole Symposium
  didn’t signal much but she wasn’t as dovish as the market expected her to be.
• The Eurozone CPI beat
  expectations on the headline reading due to higher energy prices, but the Core
  CPI came out in line with forecasts.
• The market doesn’t expect the ECB to hike at the
  upcoming meeting.

EURUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that EURUSD yesterday
broke out of the downward trendline but
found strong sellers around the red 21 moving average. The
price is now falling back below the trendline in what could end up being a
fakeout. This is generally a bearish signal so the buyers will need to break
out again to invalidate the bearish setup.

EURUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we’ve been diverging with the
MACD for a
long time and this is generally a sign of weakening momentum often followed by
pullbacks or reversals. In this case, we got a breakout of the trendline which
should point to a bigger pullback into the 1.1033 level, so what happens after
today’s fakeout will be key. Right now, the price is testing the red 21 moving
average and we should find buyers stepping in here, but if the price continues
lower, then the sellers will be in control and start targeting a break below
the major bottom trendline.

EURUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that we
have a support zone
at the last higher low level where we can also find the 50% Fibonacci
retracement level for confluence. If
the price breaks through it, it will make a new lower low and switch the market
structure from bullish to bearish. So, the buyers should step in here with a
defined risk below the level to target a new higher high, while the sellers
will want to see a break lower to pile in and extend the selloff.

Upcoming Events

This week is all about the US labour market data and the
recent releases haven’t been encouraging on a forward-looking basis. Today, the
main event will be the US Jobless Claims report accompanied by the US PCE data.
Tomorrow, we conclude the week with the US NFP and ISM Manufacturing PMI
reports.

This article was written by FL Contributors at www.forexlive.com.