As we head into Tuesday, September 3, 2024, global markets are positioned for a session that could see heightened volatility, driven by a series of significant economic data releases. The U.S. dollar remains the focal point as traders react to recent data and prepare for upcoming reports, particularly in the wake of the Labor Day holiday in the U.S.
In the currency markets, the EUR/USD pair experienced a choppy session, largely influenced by mixed economic signals from the Eurozone and the U.S. The euro remains under pressure amid ongoing concerns about the region’s economic outlook, as traders await further insights from the European Central Bank (ECB) and U.S. ISM Manufacturing data, which could provide more direction for the pair.
Meanwhile, the USD/JPY pair saw a robust recovery, reflecting a stronger U.S. dollar driven by favorable risk sentiment and recent economic data that supported the greenback. The pair’s movements were also influenced by positioning ahead of key U.S. economic data releases later this week.
The AUD/USD pair exhibited notable volatility, reflecting the market’s sensitivity to risk sentiment and recent Australian economic data. Traders are closely monitoring developments as they assess the implications of upcoming U.S. economic figures, particularly in relation to global trade dynamics.
EUR/USD
Technicals in Focus
The EUR/USD pair remained volatile, closing near the 1.1060 level after oscillating throughout the session. The pair’s movements were influenced by mixed Eurozone and U.S. economic data, with traders showing caution ahead of the U.S. ISM Manufacturing PMI release.
On the technical front, the MACD indicator is hovering near the zero line, with histograms showing minimal momentum, suggesting indecision in the market. The Stochastic Oscillator is in neutral territory, offering no clear directional bias. The 14-day RSI remains subdued, reflecting the pair’s current range-bound behavior.
Trading Strategy: Neutral to Sell
Sell below 1.1060-1.1040 with targets at 1.1010-1.0990 and 1.0960-1.0940, with a stop loss above 1.1090. Alternatively, consider long positions above 1.1090 with targets of 1.1120-1.1150 and 1.1180-1.1210, with stops below 1.1040.
USD/JPY
Technicals in Focus
The USD/JPY pair showed strong recovery momentum, trading around the 146.95 level after testing lower levels earlier in the session. The pair was supported by improved risk sentiment and a stronger U.S. dollar, driven by favorable economic data.
Technically, the MACD is above the zero line with expanding histograms, indicating solid bullish momentum. The Stochastic Oscillator has entered overbought territory, which may suggest the potential for a short-term pullback. However, the overall trend remains bullish as the 14-day RSI supports further upside.
Trading Strategy: Neutral to Buy
Buy above 146.95-146.75 with targets at 147.30-147.50 and 147.80-148.00, with a stop loss below 146.50. Alternatively, consider selling below 146.50 with targets of 146.20-145.90 and 145.60-145.30, with stops above 146.95.
AUD/USD
Technicals in Focus
The AUD/USD pair experienced significant volatility, with the pair closing near the 0.6790 level after a sharp upward spike. This movement was largely driven by risk sentiment and recent Australian economic data, as traders remain cautious ahead of U.S. economic releases.
On the technical side, the MACD is near the zero line with a slight upward bias, indicating potential bullish momentum. The Stochastic Oscillator has just crossed out of oversold territory, suggesting a potential for further upside. The 14-day RSI is neutral, reflecting the pair’s current consolidation phase.
Trading Strategy: Neutral to Buy
Buy above 0.6790-0.6770 with targets at 0.6810-0.6840 and 0.6870-0.6900, with a stop loss below 0.6750. Alternatively, consider selling below 0.6750 with targets of 0.6730-0.6700 and 0.6670-0.6640, with stops above 0.6790.
Market Outlook
Looking ahead, the U.S. ISM Manufacturing PMI data will be closely watched as it could provide key insights into the strength of the U.S. economy and the future direction of the U.S. dollar. Additionally, traders will monitor any updates from the ECB as they continue to gauge the central bank’s policy stance amidst ongoing economic uncertainties in the Eurozone.
In Japan, the market will be attentive to household spending data, which could impact the yen’s direction, particularly in relation to the USD/JPY pair. The Australian dollar’s performance will also be closely tied to risk sentiment and developments in global trade dynamics.
Overall, the market is expected to remain sensitive to economic data and central bank communications, with the potential for increased volatility as traders react to new information.