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  • Risk sentiment stays neutral on Thursday amid holiday in the US.
  • US Dollar Index moves sideways near Wednesday’s closing level of 96.75.
  • Friday’s NFP data from the US likely to be the last catalyst ahead of the weekend.

As expected, Thursday’s market action didn’t offer any trading opportunities as the thin trading volume forced major pair and commodities to stay stuck in tight ranges. The XAU/USD pair, which came within a touching distance of the multi-year highs that it set at $1439 in late June on Tuesday, was last seen consolidating this week’s gains at $1415 losing 0.25% on the day.

Although the pair started the week under pressure amid the sharp rebound seen in the US Treasury bond yields, revived concerns over an economic slowdown following cautious remarks from ECB and BoE officials helped the precious metal gather strength against currencies.

Earlier this week, BoE Governor Carney adopted a cautious tone regarding the economic outlook and sent the UK government bond yields lower. Today, Germany’s 10-year Treasury bond yield lost more than 5% and fell below the ECB’s deposit rate of -0.4% for the first time to show that markets continue to lean towards safer assets and expect central banks to remain on the dovish side.

On Friday, the Nonfarm Payrolls Report published by the U.S.  Bureau of Labor Statistics will be watched closely by the market participants. A strong rebound in the NFP and a higher-than-expected reading could cause markets to start doubting a Fed rate cut at the end of this month and help the greenback gather strength and vice versa.

Technical levels to watch for