ATFX Market Outlook 10th January 2025

ATFX Market Outlook 10th January 2025

Market Watch: Nonfarm Payrolls and the Fed's Rate Outlook

Opinion Today:

Attention is on December's nonfarm payrolls, set for Friday's release as investors seek insights into the labour market and interest rate trajectory. A strong labour market could allow the Fed to slow its rate cuts following a 1% reduction in 2024 due to fears of a slowdown. However, the Fed has lowered its 2025 rate cut outlook amid concerns over persistent inflation and the impact of protectionist policies from the Trump era. A key focus will be whether the resilience in the U.S. job data translates to robust corporate earnings, particularly among significant technology stocks that drove Wall Street in 2024, and whether this strength extends beyond the tech sector.

Tonight, investors will focus on the US December non-farm payrolls report. Non-farm payrolls are expected to fall to 160,000, down from 227,000 in November, while the unemployment rate is predicted to hold steady at 4.2%. The key focus is on monthly and yearly hourly average earnings to guide inflation; positive data may encourage the Federal Reserve to pause interest rate cuts in January. Please look at the ATFX NFP Preview ahead of the US job data release: https://youtu.be/vTDmtL9b0E0.

Key Data:

21:30 US Non-Farm Payrolls DEC *** 

21:30 CA Unemployment Rate DEC ** 

23:00 US Michigan Consumer Sentiment JAN Prel *** 

Key Data and Event Next Week:

US, GB and EU December Inflation Data 

IEA and OPEC Monthly Report 

US Weekly Initial Jobless Claims 

US and GB December Retail Sales 

China's State Council Information Office Press Conference 

EU German Parliament Vote of Confidence 

EUR/USD

1.0368/1.0396 Resistance

1.0249/1.0221 Support 

The euro continued to decline against the US dollar yesterday, pressured by the rising dollar. It dropped below 1.0300, with last week’s low at 1.0221 now serving as key support. Tonight's US job report will determine if the pair gains momentum. 

GBP/USD

1.2383/1.2409Resistance 

1.2237/1.2210 Support 

The UK government's fiscal challenges and the global bond market crash have caused a sharp rise in UK government bond yields. Yesterday, the pound dropped to its lowest level against the US dollar since 2023, reaching 1.2239 for the third consecutive day of decline. This figure now acts as initial support. However, the pound recovered to around 1.2300 at the end of trading, which may help mitigate short-term downward pressure. Upcoming US key job data will be closely watched for further guidance.

USD/JPY

158.89/159.12 Resistance

157.55/157.30 Support 

The USD/JPY pair stopped its three-day rally yesterday and turned around, giving up some gains above 158.40. However, it received timely support after testing the 10-day moving average during the session and maintained its recent high range. Therefore, we will focus on the US job data guidance during the day. If it is positive, there is still a chance that the pair will continue to rise.

USD/CAD

1.4436/1.4464Resistance

1.4348/1.4320 Support

The USD/CAD pair gained for three consecutive days, staying upward. It has risen above the 10-day moving average, signalling potential growth, but a recent rebound may limit further increases. It's unclear if it can reach this week's high of 1.4449. Tonight’s U.S. and Canadian jobs reports will offer necessary guidance.

U.S Crude Oil Futures (Feb)

74.89/75.26 Resistance 

73.37/73.09 Support

This colder-than-usual winter is driving strong oil demand. After opening lower yesterday, U.S. oil rebounded above $74 and has traded between $75.26 and $72.87 this week. To maintain the overnight rebound momentum, it must stay above $74. Its ability to break through this level will depend on tonight's U.S. jobs report.

Spot Gold

2684/2690 Resistance

2651/2645 Support

Spot Silver

30.46/30.59 Resistance

29.73/29.59 Support 

Spot gold continued its upward trend on Thursday, nearing $2,680 before gaining 0.33%. This marks its highest level since early December, with a cumulative rise of over 1% for three consecutive days. If it stays above the $2,700 mark, it will enter a previously resisted high range. The direction of gold will depend on the upcoming US jobs report. If there is a pullback, support may be found below $2,650.

US30

42954/43360 Resistance 

42150/41641 Support 

The market was quiet overnight, with the U.S. stock market closed. Today's jobs report is crucial for guiding expectations about Fed rate cuts. The Dow futures rebounded recently but lack momentum unless they break above the 10-day moving average at 42,770, influenced by the US jobs report.

NAS100

21444/21710 Resistance

20798/20586 Support 

The Nasdaq rose initially but then declined this week, reaching its lowest point. Its recovery depends on the US jobs report tonight. If US Treasury yields rise amid the strengthened jobs report, a rebound may be hindered, possibly leading to levels below 21,000. Initial resistance is around the 10-day moving average of 21,340.

BTC (Bitcoin)

97056/98406 Resistance

90010/88637 Support

Bitcoin (BTC) is trading below $94,000, down over 5% this week, with $568 million in ETF outflows showing weakened demand. If it falls below the 38.2% Fibonacci level at $92,493, support may be tested at $90,010 and $88,637. The Relative Strength Index (RSI) is at 43, indicating bearish momentum, but a recovery above $98,000 could lead to a high of $100,000.

About ATFX 

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