By Orbex

It was a busy day for the currency markets yesterday. The German factory orders report showed that output increased 2.6% on the month beating estimates of a 1.1% increase. Previous month’s revisions showed a revised print from a 2.5% decline to just 1.6%.

In the NY trading session, the ADP payrolls report showed that the economy added 177k jobs in June. This was below the median estimates of 190k. Data for May was revised higher to show 189k jobs.

The services sector measured by ISM showed an increase to 59.1 on the index. This beat estimates by a strong margin and activity was seen rising from May’s 58.6.

Later in the evening, the FOMC meeting minutes were released. The minutes showed that officials were concerns about letting inflation run too hot. Members were seen widely agreeing that further rate hikes were needed. The markets did not react much to the release of the Fed minutes.

Looking ahead, the U.S. and Canada jobs report will be coming out today. Canada’s employment change is expected to show 20.4k jobs being added. This marks a bullish print which could potentially trigger the BoC to likely hike rates once again. The Canadian unemployment rate is expected to remain steady at 5.8%.

In the U.S. the payrolls report is expected to show that the economy added 195k jobs on the month, marking a slower pace compared to the 223k jobs added the month before. The U.S. unemployment rate is expected to hold at 3.8% and the wage growth is forecast to rise 0.3% on the month.

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EURUSD intra-day analysis

EURUSD (1.1686): The EURUSD currency pair’s gains were capped near the minor rising trend line. The common currency rose to a fresh monthly high before easing back. The consolidation over the week has resulted in a rising wedge pattern. A breakout from this pattern on the 4-hour chart could signal the EURUSD likely to fall back to the 1.1610 level of support. To the upside, price action will need to breakout above 1.1730 in order to signal further gains to the upside.

USDJPY intra-day analysis

USDJPY (110.69): USDJPY was seen hugging the resistance level near 110.62 by Thursday’s close. Price action remains trading flat around this level as we expect to see the currency pair potentially pushing lower. The support at 109.57 – 109.43 is most likely to be tested to the downside. Alternately, a breakout above 110.62 could keep the currency pair maintaining its bullish gains to the upside. A higher close above 111.12 could trigger further gains toward 111.37 marking the highs from mid-May.

XAUUSD intra-day analysis

XAUUSD (1254.20): Gold prices maintain their subdued price action with the precious metal seen giving up some of the gains earlier today. There is scope for a bullish flag pattern to be validated. This could potentially keep price action to trend higher. The support at 1252.4 remains a key level. As long as this minor support holds, gold prices are likely to target the resistance at 1263 with further gains on a breakout seen pushing the precious metal to 1273.47 which marks the measured move of the bullish flag pattern.