US ECONOMY IN FOCUS DURING THE FIRST FULL TRADING WEEK OF 2021

During the upcoming trading week, traders and investors look to the release of US Non-farm payrolls jobs, ISM Manufacturing data, and the FOMC meeting minutes. United States politics is also heavily in focus this week due to the Georgia run-off, which is set to decide the fate of the US Senate. Supporters of President Trump are also set to stage a mass protest outside the White House this week.

Traders will also be focused on Manufacturing and PMI Services numbers from the United Kingdom economy, and monthly Canadian jobs numbers. Market participants also look to Consumer Price Inflation and  PMI Manufacturing data from the eurozone.

Monday 4th January, EU Manufacturing PMI

The EU Manufacturing Purchasing Managers Index is released by Markit Economics and measures the activity level of purchasing managers in the manufacturing sector. The manufacturing PMI is an important indicator of business conditions and the overall economic condition in the eurozone because the manufacturing sector represents nearly a quarter of total GDP. A reading above 50 indicates expansion in the sector and below 50 indicates contraction.

  • The EURUSD pair is only bearish while trading below the 1.2200 level, key support is found at the 1.2150 and 1.2000 levels.
  • If the EURUSD pair trades above the 1.2200 level, buyers will likely test towards the 1.2300 and 1.2420 resistance levels.

Tuesday 5th January, ISM Manufacturing Survey

The Institute for Supply Management (ISM) Manufacturing shows business conditions in the United States manufacturing sector. The ISM Manufacturing survey is a significant indicator of the overall economic condition in the US. A monthly ISM figure above 50 is seen as positive for the US dollar currency, whereas a below 50 reading is seen as negative for the US dollar currency.

  • The AUDUSD pair is bearish while trading below the 0.7550 level, key support is found at the 0.7400 and 0.7210 levels.
  • If the AUDUSD pair moves above the 0.7550 level, buyers may test towards the 0.7750 and 0.7800 levels.

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Wednesday 6th January, FOMC Meeting Minutes

The Federal Open Market Committee that organizes 8 meetings in a year and reviews economic and financial conditions, determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth. FOMC Minutes are released by the Board of Governors of the Federal Reserve and are a clear guide to the future US interest rate policy.

  • The USDCHF pair is only bearish while trading below the 0.9000 level, further downside towards the 0.8740 and 0.8660 support levels seems possible.
  • If the USDCHF pair trades above the 0.9000 level, buyers are likely to test towards the 0.9050 and 0.9100 resistance levels.

Thursday 7th January, US Continuing Jobless Claims

US Continuing Jobless Claims is released by the United States Department of Labor measure the number of individuals who are unemployed and are currently receiving unemployment benefits. It presents the strength in the labour market. A rise in this indicator has negative implications for consumer spending which discourage economic growth. Due to the ongoing COVID-19 pandemic, the Continuing Jobless Claims number can be quite volatile on a weekly basis.

  • The GBPUSD pair is only bullish while trading above the 1.3440 level, key resistance is found at the 1.3660 and 1.3800 levels.
  • If the GBPUSD pair trades below the 1.3440 level, sellers may test towards the 1.3300 and 1.3200 levels.

Friday 8th January, US Nonfarm Payrolls Job Report

The NFP job report shows the monthly change in employment in the American economy, excluding the farming sector. The Non-farm payrolls job report is the most carefully observed indicator in the employment situation inside the United States. It is considered the most inclusive calculation of job creation, which causes the Nonfarm Payrolls Job report to become highly significant to market participants, due to the great importance of labour in the United States economy.

  • The USDCAD pair is only bearish while trading below the 1.2900 level, further losses towards the 1.2550 and 1.2400 levels remains possible.
  • If the USDCAD pair trades above the 1.2900 level, buyers are likely to test the 1.3000 and 1.3150 resistance levels.


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