Gold rises for the third consecutive day as US Dollar, yields drop ahead of NFP

Global markets turned risk-off as inflation woes amplify ahead of the top-tier data. The sour sentiment, however, sought solace in Gold, rather than the US Dollar, as the greenback traders trace downbeat Treasury bond yields with eyes on today’s key employment report.

With this, the precious metal advances for the third day in a row but Brent Oil fails to improve and rather prints a four-day losing streak.

That said, GBPUSD benefits from a price-positive GDP surprise and ignores weakness in industrial and manufacturing activities. On the other hand, USDJPY also remains firmer as the Bank of Japan (BoJ) defends its easy money policy to wish goodbye to the dovish leader Haruhiko Kuroda.

Elsewhere, AUDUSD and NZDUSD print mild gains whereas USDCAD struggles to cheer US Dollar’s weakness amid downbeat Oil price, Canada’s major export earner.

It should be noted that the risk-aversion could be well-witnessed on the crypto front as BTCUSD and ETHUSD renews two-month low as bears poke the 200-DMA support.

Following are the latest moves of the key assets:

• Brent oil dropped for the fourth consecutive day, down 0.40% intraday near $81.35 at the latest.
• Gold rises for the third day in a row while printing mild gains near $1,833.
• USD Index extends pullback from a three-month high to 105.20 as we write.
• Wall Street closed in the red and so did equities in the Asia-Pacific region while shares in Europe and the UK trace the overall mood to drop further.
• BTCUSD and ETHUSD both remain bearish around $20,000 and $1,410 levels respectively.

Volatile markets fail to inspire US Dollar bulls

Be it the BoJ’s readiness to enrich Kuroda’s farewell with inaction or the mixed UK data, not to forget fears of more geopolitical tension surrounding Russia and China, everything weighs on the market sentiment. However, the general risk-safe currency, namely the US Dollar, remains depressed as the early clues for today’s US data appear downbeat. Also weighing on the greenback could be the softer US Treasury bond yield and the fears from President Joe Biden’s budget for 2024 that proposes a heavy tax hike for rich Americans.

In addition to the US Dollar’s downbeat performance, expectations of China’s strong economic transition and higher stimulus allowed the Gold buyers to keep the reins. Crude oil, on the other hand, bear the burden of economic slowdown chatters.

GBPUSD holds onto the early-week advances whereas USDJPY reverses the previous day’s heavy losses with mild gains on BoJ’s inaction. Further, EURUSD awaits the US jobs report and the USDCAD also eyes employment data from the US and Canada.

Cryptocurrencies witness downside pressure amid fears of more regulations and an industry-negative budget from Biden.

• Strong buy: USDJPY
• Strong sell: ETHUSD, GBPUSD
• Buy: USD Index, USDCAD, Nasdaq, EURUSD
• Sell: DAX, FTSE 100, gold, BTCUSD, AUDUSD.

US NFP, Canadian Employment and ECB’s Lagarde awaited

As if the currently zigzag markets aren’t enough, the market players flex muscles to infuse more volatility into the trades with eyes on US and Canadian jobs report, as well as ECB President Lagarde’s last play ahead of next week’s monetary policy report. It should be noted that the US NFP bears the downbeat forecasts but a positive surprise is on the cards and can very well propel the US Dollar.

May the trading luck be with you!