- The Dollar traded in a volatile environment and with bearish outlook after the mixed NFP release.
- Gold slipped below a range on its H1 chart after the NFP release and to a new low from 9, May.
The mixed NFP report which was much-anticipated and released last Friday (7, July, 2017) showed the U.S. economy added 222,000 jobs in June, surprisingly higher than both May’s figure and the consensus, while the unemployment rate jumped from 4.3% to 4.4% and the worse-than-expected average hourly earnings remained unchanged to May’s reading. Therefore, the Dollar traded in a volatile market, indicating the bears and bulls were not on the same page as the Dollar traded in a tight range late session. Combining the stagnant average hourly earnings, weakening consumers spending, with the slightly decline in oil price, it was highly likely that we see a decrease for the fourth consecutive month in U.S. CPI, due for release on Friday. Therefore, the Dollar could continue to decline and tested lows of 30, June as it could increase risks to delay U.S. rate hike.
Overall, the Dollar Index (DXY) traded and was held below its EMA30 resistance on its H4 chart with its short-term moving averages lower than its long-term moving averages. The Index could dip lower again as its short-term moving averages, which flattened, kept a certain distances away from its long-term moving averages, which continued its downtrend and in a state of diverging.
（DXY H4 chart）
As to non-U.S. currencies, euro Friday’s decline found support at its long-term moving averages on its H4 chart. Euro may rebound again in the short term as it traded and consolidated above its EMA30. The Pound slipped below its EMA 60 on its H4 chart while found support at a rising trend line on its daily chart right now and it could trade between EMA60 and EMA 169 in the short term. The commodity currency Aussie dollar recovered Friday and traded above its EMA60 on its H1 chart after it found support at a rising trend line on its daily chart. Wait and see if it could extend rally in the short term.
（GDPUSD H4 chart）
As far as precious metals were concerned, gold as expected slipped below a range on its H1 chart before rallied Friday on the NFP report. Gold declined again this morning and with strong declining momentum, price could create a new low in London session.
（Gold H4 chart）
By JasonZou —— Chief Analyst of AvaTrade China
Disclaimer: The views and opinions expressed in this article are those of the authors and for the purpose of reference only, and shall not be relied upon by investors in making any trading decisions.