The US dollar accelerated its bullish momentum after strong economic numbers and progress on infrastructure spending. The dollar index rose $92.85, which was higher than last week’s low of $92.50. Data published on Friday showed that the economy added more than 900k jobs in July while the unemployment rate declined to 5.3% in July. Meanwhile, the Senate inched towards a $1 trillion infrastructure deal that will see the country build more roads and bridges, fund Amtrack, and invest in clean energy. Still, the impact of the bill to the economy will be muted since it will be implemented over a 10-year period.
US stock futures declined by more than 95 points even after Warren Buffett’s Berkshire Hathaway published strong results. The company’s total profits jumped by 7% in the second quarter as most of its portfolio companies did well. It made $28.1 billion, with its operating income rising to $6.7 billion. Among its best performers were railroads like BNSF. Its cash pile rose to $144 billion. Meanwhile, data published by Refinitiv showed that profits at all companies in the S&P 500 index rose by 93% in the second quarter from a year ago.
The economic calendar will be relatively muted today. Earlier on, China published inflation data, where the headline CPI rose by 1.0% and the producer price index (PPI) rose by 9.0%. The key data to watch will be the Switzerland unemployment rate and German trade data. In the US, the Bureau of Labour Statistics will publish the JOLTS job openings report.
EURUSD
The EURUSD pair declined to 1.1750, which was the lowest level since late July. On the four-hour chart, the pair moved below the 25-day moving average while the MACD moved below the neutral line. The RSI has moved to the oversold. The volume also remained higher. Therefore, the pair may keep falling now that it has moved below the key support at 1.1750. The next level to watch will be 1.1700.
USDCHF
The USDCHF pair rose to 0.9150 after the US jobs numbers. This was the highest level since July 30. On the 4 hour chart, the pair managed to move above the key resistance at 0.9132, which was the neckline of the double-bottom pattern. It also rose above the 25-day and 50-day moving averages while the RSI has moved above the overbought level. Therefore, the pair will likely keep rising ahead of the Swiss unemployment data.
US30
The Dow Jones futures retreated to $35,100, which was lower than its all-time high of $35,230. On the 4 hour chart, the price was slightly above the 25-day and 50-day moving averages while the neutral and signal lines of the MACD moved above the neutral level. The index will likely rebound as traders target the resistance at $35,500.
