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ForexNASDAQ Eyes All-Time High as Employment Data Eases Investor Concerns

NASDAQ Eyes All-Time High as Employment Data Eases Investor Concerns

  • The JOLTS Job Openings comes in slightly higher than expectations improving investor sentiment.
  • The NASDAQ rises 0.88% after the release of the latest US JOLTS Job Openings.
  • Federal Reserve chairman advises inflationary data shows sign of inflation “cooling”. Reuter’s SmartEconomics predicts a Consumer Price Index reading of 0.1% for June.
  • Investors turn their attention to the latest employment data and tonight’s FOMC Meeting Minutes.

USA100 – Employment Data Eases Concerns and Pushes The NASDAQ Close To An All-Time High!

The NASDAQ has risen 1.40% this week as market risk appetite improves, and institutions position themselves for the next earnings season. The NASDAQ has now formed a second higher high and a third higher low. For this reason, technical analysts are pointing towards a potential bullish trend, while economists also advise the NASDAQ is likely to perform well in the second half of the year.

The bulls quickly entered the market during yesterday’s trading session due to the positive employment data. Analysts thought the JOLTS Job Openings data would fall to the lowest since COVID lockdowns, but the figure read 180,000 more vacancies. Investors bought the news as the release confirms that the employment sector has become more “balanced”, remaining strong but simultaneously not strong enough to significantly increase salaries and inflation.

Another positive factor is the comments from the Federal Reserve’s Chairman. Mr Jerome Powell, after some persistently high inflation reports at the start of 2024, said that the data over the past 2 months “do suggest we are getting back on a disinflationary path.” However, economists are also noting that oil prices have risen by 8.40% in June 2024. According to economists, if prices remain around $85 per barrel, inflation potentially can become stickier.

However, even if inflation does become stickier, investors will soon start to turn their attention to the upcoming earnings season. Earnings season will start on Friday 12th July, but will gain momentum on the 17th! When monitoring individual components for the NASDAQ, in Tuesday’s session, 75% of the stocks rose in value and 83% of the most influential stocks rose.

The price of the NASDAQ is currently witnessing buy signals with the price trading comfortably above the 75-bar EMA and the Volume Weighted Average Price. Oscillators are also indicating buyers are controlling the market, but technical analysts are closely monitoring to ensure momentum continues. Breakout levels can be seen at $20,036.03 and $20,045.64. The NASDAQ’s all-time high is at $20,128.31.

EURUSD – The US Dollar Gains Momentum, Investors Focus On Upcoming Economic Data!

The price of the EURUSD during the Asian Session trades significantly lower which is primarily being driven by the US Dollar. However, the EURUSD quickly gains bullish momentum as the European session starts. Simultaneously, the Euro is increasing in value against most currencies and is only struggling against the AUD. US Dollar has largely been driven by positive economic data, but investors also should note dovish comments from the Fed can apply pressure.

The price of the US Dollar will mainly be influenced by three economic events. The ADP Non-Farm Employment Change, the ISM Services PMI and tonight’s FOMC Meeting Minutes. If the data reads higher than expectations, the price potentially can rise further.

Currently the EURUSD is trading within a small retracement upwards. Therefore, short term traders will closely monitor when momentum is regained, and a breakout is formed. The closest breakout level currently can be seen at 1.07354.

Michalis Efthymiou

Market Analyst

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