As we head into Monday, October 7, 2024, global markets are gearing up for a session that could witness significant volatility, fueled by critical economic data releases from major economies. The U.S. dollar continues to be the focal point for traders as recent data suggests mixed signals about the health of the U.S. economy. As a result, currency pairs such as GBP/USD, AUD/USD, and USD/JPY have experienced substantial movement, driven by both economic data and risk sentiment.
GBP/USD

Technicals in Focus
The GBP/USD pair exhibited significant volatility on Friday, closing near the 1.3110 level after dropping sharply throughout the session. The pound was hit hard as weak UK data, combined with a stronger U.S. dollar, drove a bearish outlook. On the technical side, the MACD shows bearish momentum, with a strong downward trend intact. The Stochastic Oscillator is hovering near the oversold territory, suggesting a potential short-term rebound. However, the 14-day RSI remains weak, pointing to continued selling pressure in the market.
Trading Strategy: Neutral to Sell
Sell below 1.3120-1.3100 with targets at 1.3070-1.3040 and 1.3000-1.2970, with a stop loss above 1.3150. Alternatively, consider buying above 1.3150 with targets at 1.3190-1.3220, with stops below 1.3120.
AUD/USD

Technicals in Focus
The AUD/USD pair saw considerable weakness throughout Friday’s session, closing around the 0.6787 level. Risk-off sentiment weighed heavily on the Australian dollar, as concerns over global economic growth continued to dominate market sentiment. The MACD shows increasing bearish momentum, signaling further downside pressure. The Stochastic Oscillator has moved into oversold territory, indicating a potential for some corrective bounce. However, the 14-day RSI remains bearish, suggesting that the pair could continue to drift lower in the near term.
Trading Strategy: Neutral to Sell
Sell below 0.6800-0.6780 with targets at 0.6750-0.6720 and 0.6680-0.6650, with a stop loss above 0.6830. Alternatively, consider long positions above 0.6830 with targets at 0.6860-0.6890, with stops below 0.6800.
USD/JPY

Technicals in Focus
The USD/JPY pair experienced a sharp upward spike during Friday’s session, closing near the 148.68 level. The yen weakened as U.S. economic data provided support for the U.S. dollar. The MACD shows bullish momentum, with the pair continuing to trend higher. The Stochastic Oscillator has moved into overbought territory, which could suggest a pullback in the short term. However, the overall bullish trend remains intact as the 14-day RSI indicates strong buying pressure.
Trading Strategy: Neutral to Buy
Buy above 148.70-148.50 with targets at 149.00-149.30 and 149.60-149.90, with a stop loss below 148.20. Alternatively, consider short positions below 148.20 with targets at 147.80-147.50, with stops above 148.70.
Market Outlook
Looking ahead to Monday’s session, traders will focus on key data points including UK Manufacturing Production, the U.S. Consumer Credit report, and speeches from several U.S. Federal Reserve members. These events are expected to have a significant impact on market sentiment, especially regarding the future direction of the U.S. dollar. Additionally, risk sentiment will play a critical role in the performance of currencies like the Australian dollar and Japanese yen, as traders continue to assess global economic conditions.
Overall, the market remains sensitive to economic data and central bank commentary, with potential for increased volatility as traders react to new information.