Daily Forex Analysis - 04 February 2021

USD Overview (04 February 2021)

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

The ADP Non-Farm Employment Change data (Actual: 174K, Forecast: 48K, Previous: -123K) released yesterday indicated an increase in the number of people employed in January, making a recovery from the decline in jobs in the previous month.

The Final Services PMI data (Actual: 58.3, Forecast: 57.4, Previous: 57.5) released yesterday indicated an upwards revision in the services PMI for January.

The ISM Services PMI data (Actual: 58.7, Forecast: 56.7, Previous: 57.2) released yesterday tallied with the final services PMI data release by HIS Markit, indicating an increase in the rate of expansion in the services sector.

The U.S. Unemployment Claims data (Forecast: 828K, Previous: 847K) will be released later at 2130 (SGT).

NZD/USD Outlook (04 February 2021)

Overall, NZD/USD is ranging across.

The Building Consents m/m data (Actual: 4.9%, Forecast: NA, Previous: 1.2%) released earlier today indicated an increase in the number of issued approvals by the government for building constructions.

The Preliminary ANZ Business Confidence data (Actual: 11.8, Forecast: NA, Previous: 9.4 revised from -15.6) released earlier today indicated an increase in the level of optimism of New Zealands economic outlook.

Currently, NZD/USD is testing to break above the key level of 0.72. Its next support zone is at 0.71000 and the next resistance zone is at 0.72850.

Look for buying opportunities of NZD/USD if it breaks above the key level of 0.72.

AUD/USD Outlook (04 February 2021)

Overall, AUD/USD is trending downwards. Recently, AUD/USD bounced off the support zone of 0.76000.

Reserve Bank of Australia (RBA) Governor Lowe will be testifying before the House of Representatives Standing Committee on Economics tomorrow at 0630 (SGT). During this time, there may be volatility in AUD.

The RBA will be releasing the monetary policy statement for the recent monetary policy meeting tomorrow at 0830 (SGT).

AUD/USDs next support zone is at 0.76000 and the next resistance zone is at 0.77900.

Look for short-term buying opportunities of AUD/USD.

USD/JPY Outlook (04 February 2021)

Overall, USD/JPY is trending upwards.

Currently, USD/JPY is testing to break above the key level of 105. Its next support zone is at 104.600 and the next resistance zone is at 105.800.

Look for buying opportunities of USD/JPY if it breaks above the key level of 105.

EUR/USD Outlook (04 February 2021)

Overall, EUR/USD is trending downwards.

The eurozone CPI flash estimate y/y data released yesterday indicated an increase in annual inflation.

- CPI Flash Estimate y/y (Actual: 0.9%, Forecast: 0.6%, Previous: -0.3%)

- Core CPI Flash Estimate y/y (Actual: 1.4%, Forecast: 0.9%, Previous: 0.2%)

Yesterday, it was announced that former European Central Bank President Mario Draghi has agreed to try to form a new government to lead Italy.

EUR/USDs next support zone is at 1.18800 and the next resistance zone is at 1.20750.

Look for selling opportunities of EUR/USD.

GBP/USD Outlook (04 February 2021)

Overall, GBP/USD is trending upwards.

The UK Construction PMI data (Forecast: 53.0, Previous: 54.6) will be released later at 1730 (SGT).

The Bank of England (BoE) will be announcing their monetary policy decision later at 2000 (SGT). The central bank is expected to hold its monetary policy unchanged. Nonetheless, look out for the BoEs view on the adoption of negative interest rates.

A press conference will also be held afterwards at a tentative timing. During this time, volatility is expected of GBP.

GBP/USDs next support zone is at 1.34800 and the next resistance zone is at 1.37800.

Look for short-term selling opportunities of GBP/USD up until the BoEs monetary policy announcement.

USD/CAD Outlook (04 February 2021)

Overall, USD/CAD is ranging across.

Yesterday, during the OPEC-JMMC meetings, OPEC+ kept its oil output policy unchanged.

Currently, USD/CAD is testing the support zone of 1.27900 and the next resistance zone is at 1.29800.

Look for selling opportunities of USD/CAD if it breaks the support zone of 1.27900.

GBP/JPY Outlook (04 February 2021)

Overall, GBP/JPY is trending upwards.

The UK Construction PMI data (Forecast: 53.0, Previous: 54.6) will be released later at 1730 (SGT).

The Bank of England (BoE) will be announcing their monetary policy decision later at 2000 (SGT). The central bank is expected to hold its monetary policy unchanged. Nonetheless, look out for the BoEs view on the adoption of negative interest rates.

A press conference will also be held afterwards at a tentative timing. During this time, volatility is expected of GBP.

GBP/JPYs next support zone is at 142.200 and the next resistance zone of 144.000.

Look for selling opportunities of GBP/JPY up until the BoEs monetary policy announcement.

EUR/JPY Outlook (04 February 2021)

Overall, EUR/JPY is ranging across.

The eurozone CPI flash estimate y/y data released yesterday indicated an increase in annual inflation.

- CPI Flash Estimate y/y (Actual: 0.9%, Forecast: 0.6%, Previous: -0.3%)

- Core CPI Flash Estimate y/y (Actual: 1.4%, Forecast: 0.9%, Previous: 0.2%)

Yesterday, it was announced that former European Central Bank President Mario Draghi has agreed to try to form a new government to lead Italy.

EUR/JPYs next support zone is at 125.000 and the next resistance zone is at 127.150.

Look for selling opportunities of EUR/JPY.