FX Breakout Monitor: Quiet USD pairs ahead of US jobs report FX Breakout Monitor: Quiet USD pairs ahead of US jobs report FX Breakout Monitor: Quiet USD pairs ahead of US jobs report

FX Breakout Monitor: Quiet USD pairs ahead of US jobs report

Forex 5 minutes to read
John Hardy

Head of FX Strategy

Summary:  The US dollar has backed off from recent highs only slightly and continues to eye a break higher in places ahead of the US March jobs data tomorrow. Elsewhere, precious metals are in a funk and so is the kiwi.

For a PDF copy of this edition, click here.

The USD has backed off slightly after hopeful news on the trade front overnight, especially that the US might give China as long as until 2025 to comply with some terms of a coming trade deal. Tomorrow’s US jobs report might be decisive for the US dollar, particularly interesting if it jolts US treasuries into motion and takes the key EURUSD pair into a breakdown mode below the low close for the cycle of 1.1193. Elsewhere, the weak precious metals are likely to get weaker still if US treasuries sell-off on the  jobs report tomorrow.

Breakout signal tracker

Today we take profit on our EURAUD short – modest pickings, to be sure at only 0.36 of the initial risk, but it is day seven and our maximum holding period is nine days, with tomorrow’s US jobs report offering two way risk for all risk exposed currencies like AUD. We are poised to have a look at long USD trades on a sufficiently strong close to the week, even if choosing a USD direction has been a fool’s errand in recent months.
Source: Saxo Bank
Today’s FX Breakout monitor

Page 1: a sense of rather eerie quiet as the USD majors and minors aren’t yielding any clues at the moment. The AUDNZD breakout is the most prominent development in recent days and a solid close above 1.0500 there suggests a more notable trend change risk after the long-standing downtrend of almost six months. Note that EUR, JPY and oddly, NZD, are all within striking distance of new lows versus the US dollar ahead of tomorrow’s US jobs report.
Source: Saxo Bank
Page 2: Here we note that EURSEK is making another sluggish try at the  200-day moving average just below 9.40 and eyeing a possible new low close for the cycle today – would like to see a bit more momentum there to work up any interest. And then we have the South African rand suddenly eyeing an upside breakout versus the US dollar in recent sessions (more below), possibly on a major platinum breakout today.
Source: Saxo Bank

The USDZAR has lurched in choppy fashion from weakness versus the USD to notable strength, possibly on the very important 875 area resistance in platinum falling today on high momentum. South Africa is far and away the world’s largest producer of platinum, supplying some two thirds of world production. Whether the move can continue will likely prove highly dependent on whether global risk sentiment stays supported here, though a sufficiently wild ride for platinum could sway the price action all on its own. Note as well the 200-day moving average near the current price action.
Source: Saxo Bank

We watch the weekly close here with interest, as we would like to take the sell signal if the pair closes below the 1.1200 level tomorrow.
Source: Saxo Bank

Impressively persistent upside action in recent days in AUDNZD, where a move above 1.0500 really starts to break down the down trend and will leave us interested in future upside breakout signals – hopefully not all of the upside arrives on this move here but in a future wave of buying action…
Source: Saxo Bank


The precious metals merit watching here over tomorrow’s US jobs report as strong jobs numbers and a jolt higher in US yields would likely provide the most pressure to the downside here as traders capitulate at new lows and possibly set up a run to the bigger 1250 level.

Source: Saxo Bank

REFERENCE: FX Breakout Monitor overview explanations

The following is a left-to-right, column by column explanation of the FX Breakout Monitor tables.

Trend: a measure of whether the currency pair is trending up, down or sideways based on an algorithm that looks for persistent directional price action. A currency can register a breakout before it looks like it is trending if markets are choppy.

ATR: Average True Range or the average daily trading range. Our calculation of this indicator uses a 50-day exponential moving average to smooth development. The shading indicates whether, relative to the prior 1,000 trading days, the current ATR is exceptionally high (deep orange), somewhat elevated (lighter orange), normal (no shading), quiet (light blue) or exceptionally quiet (deeper blue).

High Closes / Low Closes: These columns show the highest and lowest prior 19- and 49-day daily closing levels.  

The right-most several columns columns indicate whether a breakout to the upside or downside has unfolded today (coloured “X”) or on any of the previous six trading days. This graphic indication offers an easy way to see whether the breakout is the first in a series or is a continuation from a prior break. For the “Today” columns for 19-day and 49-day breakouts, if there is no break, the distance from the current “Quote” to the break level is shown in ATR, and coloured yellow if getting close to registering a breakout.

NOTE: although the Today column may show a breakout in action, the daily close is the key level that is the final arbiter on whether the breakout is registered for subsequent days.


The Saxo Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
- Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
- Full disclaimer (https://www.home.saxo/en-hk/legal/disclaimer/saxo-disclaimer)

None of the information contained here constitutes an offer to purchase or sell a financial instrument, or to make any investments. Saxo does not take into account your personal investment objectives or financial situation and makes no representation and assumes no liability as to the accuracy or completeness of the information nor for any loss arising from any investment made in reliance of this presentation. Any opinions made are subject to change and may be personal to the author. These may not necessarily reflect the opinion of Saxo or its affiliates.

Saxo Capital Markets HK Limited
19th Floor
Shanghai Commercial Bank Tower
12 Queen’s Road Central
Hong Kong

Contact Saxo

Select region

Hong Kong S.A.R
Hong Kong S.A.R

Saxo Capital Markets HK Limited (“Saxo”) is a company authorised and regulated by the Securities and Futures Commission of Hong Kong. Saxo holds a Type 1 Regulated Activity (Dealing in Securities); Type 2 Regulated Activity (Dealing in Futures Contract); Type 3 Regulated Activity (Leveraged Foreign Exchange Trading); Type 4 Regulated Activity (Advising on Securities) and Type 9 Regulated Activity (Asset Management) licenses (CE No. AVD061). Registered address: 19th Floor, Shanghai Commercial Bank Tower, 12 Queen’s Road Central, Hong Kong.

Trading in financial instruments carries various risks, and is not suitable for all investors. Please seek expert advice, and always ensure that you fully understand these risks before trading. Trading in leveraged products may result in your losses exceeding your initial deposits. Saxo does not provide financial advice, any information available on this website is ‘general’ in nature and for informational purposes only. Saxo does not take into account an individual’s needs, objectives or financial situation. Please click here to view the relevant risk disclosure statements.

The Saxo trading platform has received numerous awards and recognition. For details of these awards and information on awards visit www.home.saxo/en-hk/about-us/awards.

The information or the products and services referred to on this site may be accessed worldwide, however is only intended for distribution to and use by recipients located in countries where such use does not constitute a violation of applicable legislation or regulations. Products and services offered on this website are not directed at, or intended for distribution to or use by, any person or entity residing in the United States and Japan. Please click here to view our full disclaimer.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the US and other countries. AppStore is a service mark of Apple Inc. Android is a trademark of Google Inc.