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ISM Services on Watch
Today’s main data focus for the US session will be the release of the ISM Services PMI for last month. As with manufacturing, the recent trend has been lower. However, expectations this time around are for a slight increase to 52.6 from 51.9 prior. Given that the Fed has entered its blackout period ahead of the FOMC and with the headline US CPI figure still to come next week, today’s data will likely have a limited impact on markets unless we see a major surprise.
On the back of a bumper NFP print last week, a strong upside beat might see pricing shifting slightly back towards a hike. However, at around 80%, odds are likely to remain in favour of an unchanged decision no matter what the result.
Upside USD Risks
USD is currently seeing a boost on Monday as traders digest Friday’s jobs figures. A stronger NFP reading has put more focus on the idea of a hawkish pause which might be further brought into focus should we see a strong result today. If that is the case, look for USD to continue higher near-term.
Technical Views
USDJPY
The recent correction lower in USDJPY has seen the market stalling into a retest of the 138.03 level. With that area holding as support, the focus is on a further push higher for now with 142.21 and the channel top the next hurdle for bulls. A break there will open the way for a test of 145 above.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.