Forex Market Watch 01 July 2024 – 04 July 2024

Forex Market Watch 01 July 2024 – 04 July 2024

Mainstream currencies on a red background with a bar graph, representing the AI trading market and the forex news.

Article by: ETO Markets

Currency markets have been active this week amid mixed US economic data. The ISM manufacturing PMI showed a contraction in economic activity, with the index at 48.5, below the 50 level, indicating contraction, which further supported the dollar. Meanwhile, JOLTS data released on Wednesday showed the number of job openings at 8.14 million, higher than the 7.96 million expected. 

The weaker-than-expected ISM services PMI supported the dovish stance of the Fed, with the market pricing in the possibility of a rate cut in September and December 2024 at 66.5% and 44.8%, respectively. The dollar index pulled back after four straight weeks of gains. The yield on the 10-year Treasury note fell 8 basis points to 4.35%, while the two-year yield also fell 3 basis points. The market is awaiting the release of the Non-Farm Employment Change on Friday, which could significantly impact the direction of the dollar. The unemployment rate is expected to fall to 3.8%, which could add downward pressure on the dollar if it misses expectations, potentially providing short-term support for the greenback. 

On Wednesday, USD/JPY closed with a slight gain of 0.14%, mainly trading at 161.62, after falling to a low of 160.77 during the session. This move was largely driven by a rise in US Treasury yields, with the 10-year yield rising nearly 14 basis points to 4.479%, further widening the spread with Japan. In the short term, the yen is likely to continue weakening, but potential intervention by the Bank of Japan could provide support. 


The uptrend in USD/JPY remains intact despite the risk of intervention in the FX market by Japanese authorities or the Bank of Japan. The pair continues to make steady progress, trading at multi-year highs, with buyers aiming to test the psychological level of 162.00. The Relative Strength Index (RSI) shows that momentum remains in favor of buyers, and while it has entered overbought territory, it has not yet shown signs of retreating. Thus, the path of least resistance still favors the upside. 

The current resistance is at the July 3 high of …, and if a break occurs, the pair could further test … and challenge the November 1986 high of …. On the downside, if USD/JPY weakens, the first support will be at …, followed by … Tenkan-Sen. A break below this level could lead to a further pullback to Senkou Span A at … or even Kijun-Sen at …. 

AUD/USD has recently achieved an upside breakout, breaking through the $0.67 mark. Volatility may be low in the short term due to the US Independence Day holiday and the upcoming Non-Farm Employment Change data, but the overall trend is bullish. 

A break above the July high of … could challenge the December high of …and the key … level. In the event of a pullback, support is at … and the 200-day EMA at …, with further downside targets at the May low of …. 

Overall, the uptrend should continue as long as it remains above the 200-day moving average. The four-hour chart shows a resumption of upward momentum, with near-term resistance at … and … and support at 0.6645 and …. The RSI is currently around 67, indicating that there is still room for upside.  

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Disclaimer

ETO Markets Limited ​is registered in Seychelles with Company Number 850672-1 and authorised by the Financial Services Authority (FSA), Licence Number SD062; ETO Markets LLC is registered in Saint Vincent and the Grenadines with Company Number 3286LLC2023; ETO Group Pty Ltd., ABN 66 155 680 890, is a financial services company and regulated by Australia Securities & Investments Commission (ASIC), AFSL No. 420224.
The information provided on this website is general in nature only and does not constitute personal financial advice. Please note that investing in CFDs and Margin FX Contracts carries significant risks and is not suitable for all investors. You don’t own, or have, any interest in the underlying assets. Any information or general financial product advice given is generic in nature and does not take into account your financial situation, needs or personal objectives. Past performance is not a reliable indicator of future performance. Investing in leveraged products carries significant risks. We recommend that you seek independent advice and ensure that you fully understand the risks involved before trading. It is important that you read and consider our disclosure documents
(Privacy Policy & Risk Disclosure) before you acquire any product.

2024 ETO Markets | All rights reserved

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Disclaimer

ETO Markets Limited ​is registered in Seychelles with Company Number 850672-1 and authorised by the Financial Services Authority (FSA), Licence Number SD062; ETO Markets LLC is registered in Saint Vincent and the Grenadines with Company Number 3286LLC2023; ETO Group Pty Ltd., ABN 66 155 680 890, is a financial services company and regulated by Australia Securities & Investments Commission (ASIC), AFSL No. 420224.
The information provided on this website is general in nature only and does not constitute personal financial advice. Please note that investing in CFDs and Margin FX Contracts carries significant risks and is not suitable for all investors. You don’t own, or have, any interest in the underlying assets. Any information or general financial product advice given is generic in nature and does not take into account your financial situation, needs or personal objectives. Past performance is not a reliable indicator of future performance. Investing in leveraged products carries significant risks. We recommend that you seek independent advice and ensure that you fully understand the risks involved before trading. It is important that you read and consider our disclosure documents
(Privacy Policy & Risk Disclosure) before you acquire any product.

2024 ETO Markets | All rights reserved

c

Disclaimer

ETO Markets Limited ​is registered in Seychelles with Company Number 850672-1 and authorised by the Financial Services Authority (FSA), Licence Number SD062; ETO Markets LLC is registered in Saint Vincent and the Grenadines with Company Number 3286LLC2023; ETO Group Pty Ltd., ABN 66 155 680 890, is a financial services company and regulated by Australia Securities & Investments Commission (ASIC), AFSL No. 420224.
The information provided on this website is general in nature only and does not constitute personal financial advice. Please note that investing in CFDs and Margin FX Contracts carries significant risks and is not suitable for all investors. You don’t own, or have, any interest in the underlying assets. Any information or general financial product advice given is generic in nature and does not take into account your financial situation, needs or personal objectives. Past performance is not a reliable indicator of future performance. Investing in leveraged products carries significant risks. We recommend that you seek independent advice and ensure that you fully understand the risks involved before trading. It is important that you read and consider our disclosure documents
(Privacy Policy & Risk Disclosure) before you acquire any product.

2024 ETO Markets | All rights reserved

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