With the opening of the European trading session on Thursday, news was released that the Bank of England left interest rates on hold and asset purchases unchanged. The lack of monetary easing provided only short-term support for the GBP so there will need to be more good news for the pound to strengthen further.
I note another very important publication, which took place on Thursday – The report in the number of applications for unemployment benefits in the United States. Data came in well below expectations which put pressure on the US dollar against major currencies.
For example, the GBP/USD currency pair after hitting a session low at 1.2265 rose by more than 140 points. There may be further growth when the next report on the US labor market is released.
Today, during the American trading session, the latest unemployment rate and non-farm payrolls data will be released, and the news is expected to be dissapointing. Economists expect job numbers to fall by 22 million and an increase in unemployment to a record level of 16%. If analysts are correct or the figures are even worse, the USD may come under further pressure.
And now let's move on to the oil market, where we are witnessing some sort of stabilization. Yes, trading volatility remains elevated on the third trading day, and the price of the American WTI crude oil remains between $ 23 and $ 26 per barrel. This is where the opinions of traders and investors diverge: some say that by June the existing oversupply will be eliminated, while others are much more pessimistic. As a result, we are witnessing a phase of uncertainty, which is expected to last until more news hits the market.
We will complete the review with a deal to sell the USD/CAD currency pair from the technical resistance level of 1.4150. The Stop Loss order was placed 30 points above the transaction opening price, and the Take Profit order at the nearest support level 1.4020. The Profit on this transaction amounted to $930. Total risk remained below $220, which allowed for a risk to profit ratio of more than 1 to 4.