What's next for the USD after the Labor Day long weekend?
The USD finished the week higher. The NFP (Non-Farm Payroll) number came out strong on Friday (187k), but the data of past months was revised sharply lower, so USD spiked down after the NFP release. The USD gained momentum and finished the session higher, following strong Manufacturing PMI data. Also, some FED comments that “3.8% jobless rate is still low” helped to support the Dollar Index which has room for 105-106 resistance, based on Elliott Wave patterns and sentiment. However, in the short-term there can be some slow price action because of holidays in US and Canada, so maybe we will have to wait on new real flows on Tuesday or Wednesday.
Looking at the 4h chart of the USDJPY, this can be an ongoing fifth wave, with room for 148-150 after the recent wave 4 pullback that found a support last week, as expected at the 144.50-144 area. So it appears more gains are coming and that we will have to be patient here regarding the bearish price action, and wait on a new impulse down first, before we may look for any kind of a change in trend. So for now, trend is still up, for 148.
Thank you,
Grega
www.twitter.com/GregaHorvatFX
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