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MTrading Team • 2022-12-02

USDCAD portrays market’s indecision ahead of US NFP, Canada Employment data

USDCAD portrays market’s indecision ahead of US NFP, Canada Employment data

Global markets turn dicey after a volatile week as traders await crucial jobs reports from the US and Canada. Also adding strings to the trading restrictions could be the mixed comments from the policymakers from Europe, Australia and Japan.

However, the US Dollar remains pressured amid hopes of downbeat US data favoring more easy rate lifts while the Yen rose notably as Japan teases monetary policy tightening. USDCAD stayed sidelined as oil buyers retreated and a likely downbeat prints of employment report from the US and Canada.

Gold price grind higher after crossing the key resistances while NZDUSD lead the bulls as RBNZ versus Fed divergence gained more attention.

Cryptocurrencies pare the weekly gains but intraday bears struggle to keep the reins as of late.

Following are the latest moves of the key assets:

  • Brent oil struggles to defend three-day uptrend near $87.50.
  • Gold retreats from four-month high but stays indecisive near $1,800.
  • USD Index licks its wounds near the lowest levels since late June.
  • Wall Street closed mixed and so do equities in the UK and Europe.
  • BTCUSD prints mild losses near $17,000 whereas ETHUSD clings to $1,280 at the latest.
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Solid and steady

Although the pre-data anxiety results in the market’s inaction, expectations of less hawkish central bank moves and economic recovery in China keep the buyers hopeful. The cautious optimism weighs on the US Dollar but failed to underpin the recovery of equities.

ECB President Lagarde cited the need for fiscal measures, in addition to strong monetary policy moves, to defend the bloc’s economy. On the other hand, BOJ’s Kuroda tamed hawkish hopes. Elsewhere, RBA Governor Lowe tried to push back the doves even if the message failed to get through.

IMF’s Georgieva suggested more measures for China before confirming the economic recovery while the G7 price cap on Russian Oil exports also challenged the market’s mood.

Amid these plays, USDJPY and NZDUSD cheered the US Dollar weakness to the fullest but the USDCAD occupied the other end.

Elsewhere, BTCUSD and ETHUSD keep searching for more clues to convince traders that they’re worthy investments despite the looming harsh regulations and bankruptcies by the key players.

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

NFP is the key

Looking forward, the global markets may witness further grinding ahead of the US and Canadian jobs reports. However, likely downbeat prints of the US NFP raise fears of a positive surprise and a strong reaction, which in turn highlights the figure for the market players to watch, especially when the Fed policymakers are ready to ease the aggressive rate hikes. Also important will be Canadian employment data and the Fed comments during the last round of public appearances before the pre-Fed blackout period.

Overall, markets are likely to remain positive but intermediate pullbacks can’t be ruled out on the US NFP’s surprise if any.

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