Good morning Traders!
In the testimony before the US House, FED chair Jerome Powell has said that they have not yet made a decision in regard to the upcoming rates, and that this will depend on the incoming job reports and inflation readings. With that in mind, today’s non-farm payroll numbers may give traders further hints on the potential size and pace of future rates hikes by the FED.
Non-farm payroll numbers have a tendency to move the market and create volatility, the direction of the move depends not only on the actual number vs. the expectation, but also on the current narrative in the market.
If today’s number will cause a selloff reaction in the US dollar, I will be paying close attention to USDCAD
On the Daily chart, the market is currently very overextend from it’s Moving Averages, and the level I am eyeing for a potential pullback is the 1.37, this is also the previous swing Higher High on the weekly chart. Drawing the Fibonacci retracement of the latest move has the 50% retracement clustering very nicely with this level, and it also has the 61.8% clustering with the Daily swing Higher High.
If and when the market will pullback into this area, price action will also be back in the area of it’s Moving Averages. As always, I’ll be looking at the lower timeframes for signs that the pullback is over, and that the buyers are ready to take control once again.