Daily FX Market Review: U.S. Dollar Strengthens as Market Bets on a Strong Jobs Report

The U.S. dollar strengthened for the second day in a row.

The FX market is currently being heavily influenced by expectations over how quickly central banks, especially the Fed, will raise interest rates.

With the U.S. non-farm payrolls (NFP) report coming out tomorrow, the market is expecting a jobs report that will be strong enough to keep the Fed hawkish. Which is supportive of the U.S. dollar.

If you’re planning on trading the NFP release, make sure to read the event trading guide that I wrote.

Let’s review what else happened in the FX market today…

Currency Market Movers

Which currency pairs gained the most today?

As shown by our FX Market Movers page, USD/CAD was the winner gaining 0.99% or 131 pips! 🏆

Looking at its price action (PA), with the price trading above both its 50 SMA and 200 SMA, USD/CAD is clearly still in an uptrend.

Price has managed to find support and bounce off the 1.3500 area, but looks like it wants to continue to rally and retest 1.3800

Which currency pairs lost the most today?

GBP/USD was the biggest loser, falling 1.45% or 164 pips! 😔

Currency Strength

What was the overall strength or weakness of individual major currencies today?

Based on the Currency Strength Meter on MarketMilk™, USD and JPY were the strongest currencies. 💪

And GBP was the weakest currency.

If we dive a little deeper and look at all the major USD pairs, we can clearly see that USD was “green” against all currencies today.

Even against other safe-haven currencies like JPY and CHF.

In their public speeches today, Fed officials made it clear in their remarks that they were continuing to fight inflation and would not be changing course.

This provided a further boost for the dollar.

Currency Short-Term Trends

When it comes to short-term trend strength, the U.S. dollar (USD) shows the most bullish strength, along with the Japanese yen (JPY)

The Aussie dollar (AUD) shows the most bearish strength.

Currency Volatility

Which currency was the most volatile today?

Based on our Currency Volatility Meter, it’s the New Zealand dollar (NZD).

The U.S. dollar was pretty volatile also.

Which currency pair was the most volatile today?

Given that NZD was the most volatile currency, it has to be an NZD pair. But which one?

NZD/USD. It moved over 3.08% or 174 pips.