DOW Hit Record, Dollar Sold off, Focus Turns to Non-Farm Payrolls
Action Insight Daily Report 5-7-21

DOW Hit Record, Dollar Sold off, Focus Turns to Non-Farm Payrolls

Return of risk-appetite pushed DOW to new record overnight while Asian markets also firm up. Dollar was under some selling pressure, but it's still kept in range against except versus Swiss Franc and Canadian Dollar. Focus will turn to non-farm payroll report from today. A strong set of data would prompt more risk-on sentiments and give additional pressure to the greenback. On the other hand, commodity currencies would look into overall sentiments to help secure their positions as the best performers for the week.

Technically, USD/CHF's break of 0.9079 temporary low suggests down trend resumption. USD/CAD is also extending recent decline to as low as 1.2140. Break of 1.2075 minor resistance in EUR/USD would argue that up trend is ready to resume through 1.2149 resistance. That might spillover to other Dollar pairs, in particular GBP/USD and AUD/USD. Meanwhile, Gold has already taken out 1797.71 resistance, accompanying Dollar's selloff. Focus will now turn to 1828 fibonacci level.

In Asia, at the time of writing, Nikkei is up 0.19%. Hong Kong HSI is up 0.52%. China Shanghai SSE is up 0.42%. Singapore Strait Times is up 0.68%. Japan 10-year JGB yield is down -0.0001 at 0.090. Overnight, DOW rose 0.93%. S&P 500 rose 0.82%. NASDAQ rose 0.37%. 10-year yield dropped -0.023 to 1.561.

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USD/CAD Daily Outlook

Daily Pivots: (S1) 1.2099; (P) 1.2193; (R1) 1.2245; More...

USD/CAD's decline extends to as low as 1.2140 so far, just inch above 100% projection of 1.2880 to 1.2363 from 1.2653 at 1.2136. Intraday bias stays on the downside for the moment. Next target is long term cluster support at 1.2061. We'd be cautious on strong support from there to bring reversal. On the upside, break of 1.2265 minor resistance will turn bias to the upside to for rebound back to 55 day EMA (now at 1.2510). However, sustained break of 1.2061 will carry larger bearish implications. Next near term target will be 161.8% projection at 1.1816.

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EURUSD | USDJPY | GBPUSD | USDCHF | AUDUSD | USDCAD

EURJPY | EURGBP | EURCHF | EURAUD | GBPJPY

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Economic Calendar
GMT Ccy Events Actual Forecast Previous Revised
22:30 AUD AiG Performance of Services Index Apr 61 58.7
23:30 JPY Labor Cash Earnings Y/Y Mar 0.20% -0.50% -0.40%
23:50 JPY Monetary Base Y/Y Apr 24.30% 21.90% 20.80%
01:30 AUD RBA Monetary Policy Statement
01:45 CNY Caixin Services PMI Apr 56.3 54.2 54.3
03:00 NZD RBNZ Inflation Expectations Q/Q Q2 2.05% 1.89%
03:03 CNY Trade Balance (USD) Apr 42.9B 28.0B 13.8B
03:03 CNY Imports (USD) Y/Y Apr 43.10% 23.30% 38.10%
03:03 CNY Exports (USD) Y/Y Apr 32.30% 35.50% 30.60%
03:03 CNY Trade Balance (CNY) Apr 276.5B 88B
03:03 CNY Imports (CNY) Y/Y Apr 32.20% 12.60% 27.70%
03:03 CNY Exports (CNY) Y/Y Apr 22.20% 30.70% 20.70%
05:45 CHF Unemployment Rate M/M Apr 3.60% 3.30%
06:00 EUR Germany Industrial Production M/M Mar 2.00% -1.60%
06:00 EUR Germany Trade Balance (EUR) Mar 22.3B 19.1B
06:45 EUR France Trade Balance (EUR) Mar -5.4B -5.2B
06:45 EUR France Industrial Output M/M Mar 2.00% -4.70%
07:00 CHF Foreign Currency Reserves (CHF) Apr 930B
08:00 EUR Italy Retail Sales M/M Mar -1.50% 6.60%
08:30 GBP Construction PMI Apr 62.5 61.7
12:30 CAD Net Change in Employment Apr -160.5K 303.1K
12:30 CAD Unemployment Rate Apr 7.80% 7.50%
12:30 USD Nonfarm Payrolls Apr 950K 916K
12:30 USD Unemployment Rate Apr 5.70% 6.00%
12:30 USD Average Hourly Earnings M/M Apr 0.10% -0.10%
14:00 USD Wholesale Inventories Mar F 1.40% 1.40%
14:00 CAD Ivey PMI Apr 67 72.9