Market -Weekly Outlook Oct 01 2018

In the week ahead, Investors will be looking to Friday’s highly-anticipated U.S Jobs Report for further indications on the strength of the U.S economy.


USDINDEX: Around Critical Resistance!

As long as 94.97 resistance holds on a weekly closing basis, the USDINDEX remains neutral with a risk to the downside to the 93.38/92.75 levels, a halt is likely but a cut would open 91.75 levels, further down, support comes at the 90.05 levels.

The U.S. Dollar Index (USDXDXYDX) is an index (or measure) of the value of the United States dollar relative to a basket of foreign currencies.

On the upside, a weekly closing above the 94.97 levels will turn outlook neutral for testing the 96.28 levels,  it may turn lower from here, however; above 96.28 on a weekly closing basis will suggest a strong bullish momentum to the 97.68/98.65 levels ahead of the 100.00 levels.

Conclusion: The USDINDEX sees consolidation with downside risk below the 94.97 levels.


Last week the Federal Reserve raised interest rates by a quarter of a percentage point to a range of 2.00 percent to 2.25 percent. It left his plans to tighten monetary policy steadily, as the US economy is expected to enjoy at least three years of growth. The Fed is still expecting another rate hike in December, another three next year and one increase in 2020…

This development is supposed to advance the U.S dollar, but we need to keep an eye on the 94.97 levels of the U.S Dollar Index, a weekly closing above that level will advance the Index to the 96.28 levels, above 96.28 will suggest a higher leg above the 100.00 levels. On the other hand, If the Index fails to break and hold above the 94.97 levels, that means the Fed’s rate hike is not strong enough to push the dollar higher.

Levels that need to be watched are 94.97 and 96.28, above 94.97 we have a light bullish trend, above 96.28 very bullish trends.

This week, the focus will be on the U.S Nonfarm Payrolls report for September, the report will be published on Friday at 12:30 GMT.

Analysts expect it to dip 185K, from 201K a month earlier, any reading above 185K should support the Index, while any reading below 185K will put the Index under pressure.

Unemployment Rate is expected to dip 3.8%, from 3.9% in the preceding month, any reading below 3.8% is positive while any reading above 3.8% is negative for the U.S.D.

Conclusion: If both reports (Nonfarm Payrolls & Unemployment Rate) are positive, the dollar will rise, both are negative, the dollar will fall, one is positive and the other is negative, a sideways market is likely…

This is a list of the most important economic news for the week:

1- RBA Interest Rate Decision (Oct): Tuesday at 04:30 GMT. The central bank is expected to leave the rate unchanged at 1.50%. (It may bring a selling opportunity for AUDUSD).

2- U.K Construction PMI (Sep): Tuesday at 08:30 GMT. The indicator is expected to fall 52.8, from 52.9 in the previous month. ( A selling opportunity is likely for GBPUSD).

3- Fed Chair Powell Speaks: Tuesday at 16:00 GMT. He will speak about employment and inflation expectations at the annual meeting of the National Association for Business Economics in Boston. Questions may be asked after the speech. (Volatility is expected).

4- U.K Services PMI (Sep): Wednesday at 08:30 GMT. The indicator is expected to fall 54.0, from 54.3 in the preceding month. ( A selling opportunity is likely for GBPUSD).

5- U.S ISM Non-Manufacturing PMI (Sep): Wednesday at 14:00 GMT. The indicator is expected to fall 58.0, from 58.5 in the previous month.

6- Canada Ivey PMI (Sep): Thursday at 14:00. The indicator is expected to fall 61.4, from 61.9 a month earlier.

7- Australia Retail Sales (Aug): Friday at 01:30 GMT. The indicator is expected to rise 0.2%, from 0.0% in the last month.

8- U.S Nonfarm Payrolls (Sep): Friday at 12:30 GMT. The indicator is expected to fall 185K, from 201K a month earlier.

9- U.S Unemployment Rate (Sep): Friday at 12:30 GMT. The indicator is expected to fall 3.8%, from 3.9% a month earlier.

10- Canada Employment Change (Sep): The indicator is expected to rise 25.0K, from -51.6K in the last month.

You can follow the rest of the week’s economic events by visiting:

Live Economic Calendar

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