Daily Forex Analysis - 6th August 2021

USD Overview (06 August 2021)

Yesterday, USD weakened against most major currencies except EUR, JPY and CHF.

The Non-Farm Payroll jobs report will be released later at 2030 (GMT+8).

- Average Hourly Earnings m/m (Forecast: 0.3%, Previous: 0.3%)

- Non-Farm Employment Change (Forecast: 870K, Previous: 850%)

- Unemployment Rate (Forecast: 5.7%, Previous: 5.9%)

NZD/USD Outlook (06 August 2021)

Overall, NZD/USD is ranging across.

NZD/USDs next support zone is at 0.69500 and the next resistance zone is at 0.71000.

Look for short-term selling opportunities of NZD/USD up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

AUD/USD Outlook (06 August 2021)

Overall, AUD/USD is trending downwards.

During his testimony earlier today, Reserve Bank of Australia (RBA) Governor Lowe highlighted that the central bank did consider to hold back on its quantitative easing (QE) tapering plan due to the recent outbreak of COVID cases. However, since the RBA expects the Australian economy to “return to strong growth next year”, additional QE will have a very small effect right now when extra support is needed, thus it is not necessary to delay the tapering. Nonetheless, the central bank will react accordingly in case the COVID situation worsens.

The RBA will be releasing their quarterly monetary policy statement later at 0930 (GMT+8).

Currently, AUD/USD is testing to break above the key level of 0.74. Its next support zone is at 0.73300 and the next resistance zone is at 0.75000.

If AUD/USD breaks above the key level of 0.74, look for short-term buying opportunities of AUD/USD up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

USD/JPY Outlook (06 August 2021)

Overall, USD/JPY is trending downwards.

Japanese banks will be closed next Monday in observance of Mountain Day. Expect lower trading volatility and volume during the usual Japanese market hours.

Currently, USD/JPY is moving towards the key level of 110. Its next support zone is at 108.500 and the next resistance zone is at 110.800.

If USD/JPY breaks above the key level of 110, look for short-term buying opportunities of USD/JPY up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

EUR/USD Outlook (06 August 2021)

Overall, EUR/USD is ranging across.

Currently, EUR/USD is testing the support zone of 1.18200 and the next resistance zone is at 1.20000.

If EUR/USD breaks the support zone of 1.18200, look for short-term selling opportunities of EUR/USD up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

GBP/USD Outlook (06 August 2021)

Overall, GBP/USD is ranging across. Recently, GBP/USD bounced up from the key level of 1.39.

The UK Construction PMI data (Actual: 58.7, Forecast: 64.5, Previous: 66.3) released yesterday indicated a strong slowdown in the expansion of the construction sector amid shortage of construction materials.

During its monetary policy meeting yesterday, the Bank of England (BoE) held policy unchanged. For 2021, the central bank has revised its inflation projection upwards from the previous 2.5% to 4%. GDP projection for this year remained at 7.25% while unemployment rate has been revised downward from 5% to 4.75%. The BoE also highlighted that the recent rise in inflation is likely going to be transitory. In regard to the ending of the furlough scheme at the end of September, the central bank also highlighted that it does not expect unemployment rate to rise after that.

BoE committee member Broadbent will be speaking on the released monetary policy report later at 1915 (GMT+8). During this time, there may be volatility in GBP.

Currently, GBP/USD is moving down towards the key level of 1.39. Its next support zone is at 1.38000 and the next resistance zone is at 1.40000.

If GBP/USD breaks below the key level of 1.39, look for short-term selling opportunities up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

USD/CAD Outlook (06 August 2021)

Overall, USD/CAD is ranging across. Recently, USD/CAD tested and failed to break below the key level of 1.25.

The Canadian employment data will be released later at 2030 (GMT+8).

- Employment Change (Forecast: 169.5K, Previous: 230.7K)

- Unemployment Rate (Forecast: 7.4%, Previous: 7.8%)

The Canadian Ivey PMI data (Forecast: 67.3, Previous: 71.9) will be released later at 2200 (GMT+8).

USD/CADs next support zone is at 1.24500 and the next resistance zone is at 1.26100.

Look for short-term buying opportunities of USD/CAD up until the release of the Canadian and U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

GBP/JPY Outlook (06 August 2021)

Overall, GBP/JPY is ranging across.

The UK Construction PMI data (Forecast: 64.5, Previous: 66.3) will be released later at 1630 (GMT+8).

The Bank of England (BoE) will be announcing their monetary policy decision later at 1900 (GMT+8). It is expected that the central bank will be holding its monetary policy unchanged. Also, it is unlikely that the BoE will providing any details on quantitative easing (QE) tapering due to existing uncertainties arising from the COVID Delta variant, slowdown in business activities and the ending of the UK furlough scheme in September. The central bank will also be releasing its quarterly projection materials in which it is likely to revise its inflation projection upwards.

Currently, GBP/JPY is testing to break above the key level of 153. Its next support zone is at 151.000 and the next resistance zone is at 153.800.

If GBP/JPY breaks above the key level of 153, look for short-term buying opportunities up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).

EUR/JPY Outlook (06 August 2021)

Overall, EUR/JPY is trending downwards. Recently, EUR/JPY trended into the resistance zone of 130.000.

Currently, EUR/JPY is testing the resistance zone of 130.000 and the next support zone is at 128.500.

If EUR/JPY bounces off the resistance zone of 130.000, look for short-term selling opportunities up until the release of the U.S. Non-Farm Payroll jobs report at 2030 (GMT+8).