Daily Forex Analysis - 5 November 2020

USD Overview (05 November 2020)

Yesterday, USD strengthened against most major currencies except AUD and JPY.

The ADP Non-Farm Employment Change data (Actual: 365K, Forecast: 650K, Previous: 753K revised from 749K) released yesterday indicated a slowdown in the increase of employment in the private sector in October.

Also, the ISM Services PMI data (Actual: 56.6, Forecast: 57.4, Previous: 57.8) released yesterday indicated continued expansion in the services sector in October albeit at a slightly slower pace.

The Federal Reserve will be announcing their monetary policy decision tomorrow at 0300 (SGT). It is expected that the central bank will be holding rate unchanged at the target range of 0-0.25%. It is unlikely that the Fed will carry out any policy changes since the Presidential Election has not concluded.

The Fed will also be holding a press conference at 0330 (SGT). Pay attention to any remarks made by Chairman Powell on the conclusion of the Presidential Election. During this time, volatility is expected of USD.

NZD/USD Outlook (05 November 2020)

Overall, NZD/USD is ranging across. Recently, NZD/USD trended higher towards the key level of 0.67.

The ANZ Business Confidence data (Actual: -15.6, Forecast: NA, Previous: -15.7) released earlier today indicated little change in 12-month economic outlook of the surveyed 1,500 businesses.

The New Zealand Inflation Expectation q/q (Forecast: NA, Previous: 1.43%) will be released tomorrow at 1000 (SGT).

Currently, NZD/USD is testing to break above the key level of 0.67. Its next support zone is at 0.65400 and the next resistance zone is at 0.67900.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term buying opportunities of NZD/USD if it breaks above the key level of 0.67.

AUD/USD Outlook (05 November 2020)

Overall, AUD/USD is ranging across. Recently, AUD/USD moved higher and bounced down from the key level of 0.72.

The Australian Trade Balance data (Actual: 5.63B, Forecast: 3.70B, Previous: 2.62B revised from 2.64B) released earlier today indicated an increase in trade surplus in September.

The Reserve Bank of Australia will be releasing the monetary policy statement tomorrow at 0830 (SGT). Take note of the central banks economic projections.

AUD/USDs next support zone is at 0.70400 and the next resistance zone is at 0.72200.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term selling opportunities of AUD/USD.

USD/JPY Outlook (05 November 2020)

Overall, USD/JPY is trending downwards. Recently, USD/JPY bounced down from the key level 105.

Currently, USD/JPY is testing the support zone of 104.200 and the next resistance zone is at 106.300.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term selling opportunities of USD/JPY if it breaks the support zone of 104.200.

EUR/USD Outlook (05 November 2020)

Overall, EUR/USD is ranging across. Recently, EUR/USD rejected the support zone of 1.16500 and break above the key level of 1.17.

The European Commission will be releasing their economic forecasts today at a tentative timing.

The eurozone Retail Sales m/m data (Forecast: -1.4%, Previous: 4.4%) will be released later at 1800 (SGT).

EUR/USDs next support zone is at 1.16500 and the next resistance zone is at 1.17900.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term buying opportunities of EUR/USD.

GBP/USD Outlook (05 November 2020)

Overall, GBP/USD is ranging across. Recently, GBP/USD broke below the key level of 1.30.

The Bank of England (BoE) will be announcing their monetary policy decision later at 1500 (SGT). It is expected that the central bank will hold interest rate unchanged at 0.10%. It is also expected that all 9 MPC members will vote for an increase in asset purchase. The BoE will also be releasing their quarterly monetary policy report which contains their projections for the economic outlook of UK.

The UK Construction PMI data (Forecast: 55.0, Previous: 56.8) will be released later at 1730 (SGT).

Currently, GBP/USD is testing to break below the key level of 1.30. Its next support zone is at 1.27300 and the next resistance zone is at 1.30400.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term selling opportunities of GBP/USD if it breaks below the key level of 1.30.

USD/CAD Outlook (05 November 2020)

Overall, USD/CAD is ranging across. Recently, USD/CAD rejected the resistance zone of 1.32200.

The Canadian Trade Balance data (Actual: -3.3B, Forecast: -2.2B, Previous: -2.4B) released yesterday indicated a slight increase in trade deficit in September mainly due to higher crude oil imports.

USD/CADs next support zone is at 1.30300 and the next resistance zone is at 1.32200.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term selling opportunities of USD/CAD.

GBP/JPY Outlook (05 November 2020)

Overall, GBP/JPY is ranging across. Recently, GBP/JPY trended lower into the support zone of 135.350.

The Bank of England (BoE) will be announcing their monetary policy decision later at 1500 (SGT). It is expected that the central bank will hold interest rate unchanged at 0.10%. It is also expected that all 9 MPC members will vote for an increase in asset purchase. The BoE will also be releasing their quarterly monetary policy report which contains their projections for the economic outlook of UK.

The UK Construction PMI data (Forecast: 55.0, Previous: 56.8) will be released later at 1730 (SGT).

Currently, GBP/JPY is testing the support zone of 135.350 and the next resistance zone is at 137.500.

If the BoE expressed dovishness in the UK economy, look for short-term selling opportunities of GBP/JPY if it breaks the support zone of 135.35.

EUR/JPY Outlook (05 November 2020)

Overall, EUR/JPY is trending downwards. Recently, EUR/JPY bounced off the resistance zone of 122.600.

The European Commission will be releasing their economic forecasts today at a tentative timing.

The eurozone Retail Sales m/m data (Forecast: -1.4%, Previous: 4.4%) will be released later at 1800 (SGT).

EUR/JPYs next support zone is at 119.500 and the next resistance zone is at 122.600.

Since the result of the U.S. Presidential Election is not yet finalized, look for short-term selling opportunities of EUR/JPY.