The U.S. dollar was seen easing back towards Friday’s close after a solid performance during the week. The monthly payroll figures showed that the U.S. economy added 223,000 jobs during the month of May, beating estimates by a strong margin.
The U.S. unemployment rate also fell to an 18 year low to 3.8% while the median forecasts expected to see the unemployment rate staying unchanged at 3.9%. Wage growth also increased 2.7% on an annual basis for the year ending May.
Elsewhere, the monthly manufacturing PMI in the UK showed an increase to 54.4. This was higher than the estimates of 53.5 and up from the previous month’s 53.9 but below April’s 55.1.
Looking ahead, the economic calendar for the day will see the release of the UK’s construction PMI. Forecasts show that construction PMI might have eased to 52.0 from 52.5 in April.
In the U.S. the factory orders data will be coming out. Forecasts point to a 0.4% decline.
EURUSD intra-day analysis
EURUSD (1.1693): The euro currency was seen easing back on Friday after two days of gains earlier in the week. The common currency managed to hold its ground against a stronger U.S. dollar. The minor decline on Friday coincides with the falling price channel which is currently serving as dynamic resistance. In the near term, we expect the EURUSD to retest the support level at 1.1610 – 1.1577 level. A rebound off this level could signal the EURUSD to maintain the sideways range with the upper resistance at 1.1730. A breakout from this range could potentially set the stage for the next leg in the currency pair’s direction.
USDJPY intra-day analysis
USDJPY (109.60): The USDJPY posted strong gains on Friday but price action was seen easing back towards the close. The USDJPY managed to post the rally and hit the resistance zone of 109.57 – 109.43 level. We expect to see the USDJPY currency pair pulling back lower and could settle into the range with the lower support at 108.90. However, in the event of a breakout, then USDJPY could be seen extending the gains to the upside, targeting the next main resistance level at 110.85.
XAUUSD intra-day analysis
XAUUSD (1293.58): Gold prices slipped after failing to break out above the resistance level of 1304 – 1301 level. The decline in gold prices is likely to see the precious metal continuing to maintain the downside bias with the gains capped at the 1304 – 1301 level of resistance. To the downside, the support at 1282 is the most likely target as gold prices are likely to test this support level more firmly. Although gold prices look fairly bearish for the moment, we expect to see a bottom taking shape and could signal a near term change in the trend to the upside.