Sample Category Title

Daily Pivots: (S1) 0.8031; (P) 0.8052; (R1) 0.8076; More….

Immediate focus is now on 0.7984 support with current decline. Break there will resume the fall from 0.8170 to retest 0.7910 support first, and then retest of 0.7871 low. Risk will now stay on the downside as long as 0.8071 resistance holds, in case of recovery.

In the bigger picture, long term down trend from 1.0342 (2017 high) is still in progress. Next target is 100% projection of 1.0146 (2022 high) to 0.8332 from 0.9200 at 0.7382. In any case, outlook will stay bearish as long as 0.8475 resistance holds.

Daily Pivots: (S1) 1.3415; (P) 1.3437; (R1) 1.3457; More...

Immediate focus is back on 1.3549 as GBP/USD's rebound accelerates higher. Firm break there will resume the rise from 1.3140 through 1.3594 resistance for retesting 1.3787 high. For now, risk will be on the upside as long as 1.3332 support holds, in case of retreat.

In the bigger picture, up trend from 1.3051 (2022 low) is in progress. Next medium term target is 61.8% projection of 1.0351 to 1.3433 from 1.2099 at 1.4004. Outlook will now stay bullish as long as 55 W EMA (now at 1.3104) holds, even in case of deep pullback.

Daily Pivots: (S1) 1.1630; (P) 1.1650; (R1) 1.1669; More...

Intraday bias in EUR/USD is back on the upside with breach of 1.1741 resistance. Further rise should be seen to retest 1.1829 high. Firm break there will resume larger up trend and target 1.1916 projection level. Further rally is now expected as long as 1.1607 support holds, in case of retreat.

In the bigger picture, rise from 0.9534 (2022 low) long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will remain the favored case as long as 1.1604 support holds.

Dollar tumbled sharply in early New York trading Friday after much weaker-than-expected non-farm payrolls report. 10-year Treasury yield plunging through the 4.1% level while Gold also surged to fresh record high.

Traders moved swiftly to reprice Fed expectations, with a 25bps cut this month fully baked in and fresh speculation that policymakers may opt for a larger 50bps move. Looking ahead, odds of another 25bps cut in October spiked above 75%, underscoring market conviction that the central bank will need to move aggressively to shield the labor market.

That places next week’s CPI report in sharp focus. Should inflation show further signs of easing, it would open the door for the Fed to accelerate its easing cycle.

In weekly performance terms, Canadian Dollar is faring worst after its own dismal jobs data, while Yen remains under pressure but may recover some ground. Dollar is sliding toward the bottom of the performance table, likely to surpass Yen before the week closes. Euro leads gains, followed by the Aussie and Sterling, with Swiss Franc and Kiwi holding mid-pack.

In Europe, at the time of writing, FTSE is up 0.35%. DAX is up 0.09%. CAC is up 0.15%. UK 10-year yield is down -0.066 at 4.659. Germany 10-year yield is down -0.054 at 2.668. Earlier in Asia, Nikkei rose 1.03%. Hong Kong HSI rose 1.43%. China Shanghai SSE rose 1.24%. Singapore Strait Times rose 0.24%. Japan 10-year JGB yield fell -0.029 to 1.576.

US payrolls add just 22k, unemployment edges to 4.3%

US non-farm payrolls showed a sharp slowdown in hiring in August, with employment rising by only 22k, far below the 78k expected. Revisions painted a mixed picture, with July adjusted slightly higher to 79k but June lowered into contraction at -13k.

Unemployment rate ticked up from 4.2% to 4.3% as expected, while the participation rate edged higher by 0.1% to 62.3%. The employment-population ratio was steady at 59.6%, suggesting little improvement in labor utilization despite modest gains in the workforce.

Wage growth remained steady, with average hourly earnings rising 0.3% mom and up 3.7% over the past year. While pay increases are holding, the weak job creation numbers highlight the Fed’s dilemma: inflation may be edging down, but labor market cooling is becoming more pronounced.

Canada employment falls -65.5k, jobless rate jumps to 7.1%.

Canada’s labor market weakened further in August, with employment falling by -65.5k, far below expectations of 4.9k gain. This marked the second consecutive monthly contraction, driven almost entirely by a sharp -60k drop in part-time jobs, while full-time employment was little changed.

Unemployment rate climbed to 7.1% from 6.9%, above expectations, marking the highest level since May 2016 outside the pandemic years. Both the employment rate and participation rate slipped, falling to 60.5% and 65.1%.

Wage growth offered little relief, with average hourly earnings rising 3.2% yoy, slightly slower than July’s 3.3% yoy.

Bonuses lift Japan’s real wages to growth, but consumption recovery weak

Japan’s wage data showed a notable improvement in July, with real wages rising 0.5% yoy, the first increase in seven months. Nominal cash earnings jumped 4.1% yoy, far above expectations of 3.0% yoy, marking the 43rd consecutive month of annual gains.

Wage growth was boosted by a 7.9% yoy surge in special earnings, primarily reflecting summer bonuses, alongside a 2.5% yoy rise in base salaries and a 3.3% yoy increase in overtime pay, the strongest since late 2022.

However, inflation continues to erode some of those gains. Consumer prices used to calculate real wages rose 3.6% in July, still well above the BoJ’s 2% target. Food prices, especially rice, remained a major driver.

Also released, household spending increased 1.4% yoy, falling short of forecasts, though seasonally adjusted monthly spending posted a stronger 1.7% mom gain. A Ministry official said the uptick in spending was largely due to higher electricity bills and auto-related costs, while purchases of everyday food items remain subdued. “The recovery in consumer spending is not robust,” the official cautioned.

EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.1630; (P) 1.1650; (R1) 1.1669; More...

Intraday bias in EUR/USD is back on the upside with breach of 1.1741 resistance. Further rise should be seen to retest 1.1829 high. Firm break there will resume larger up trend and target 1.1916 projection level. Further rally is now expected as long as 1.1607 support holds, in case of retreat.

In the bigger picture, rise from 0.9534 (2022 low) long term bottom could be correcting the multi-decade downtrend or the start of a long term up trend. In either case, further rise should be seen to 100% projection of 0.9534 to 1.1274 from 1.0176 at 1.1916. This will remain the favored case as long as 1.1604 support holds.

Canada’s labor market weakened further in August, with employment falling by -65.5k, far below expectations of 4.9k gain. This marked the second consecutive monthly contraction, driven almost entirely by a sharp -60k drop in part-time jobs, while full-time employment was little changed.

Unemployment rate climbed to 7.1% from 6.9%, above expectations, marking the highest level since May 2016 outside the pandemic years. Both the employment rate and participation rate slipped, falling to 60.5% and 65.1%.

Wage growth offered little relief, with average hourly earnings rising 3.2% yoy, slightly slower than July’s 3.3% yoy.

Full Canada's employment here.

US non-farm payrolls showed a sharp slowdown in hiring in August, with employment rising by only 22k, far below the 78k expected. Revisions painted a mixed picture, with July adjusted slightly higher to 79k but June lowered into contraction at -13k.

Unemployment rate ticked up from 4.2% to 4.3% as expected, while the participation rate edged higher by 0.1% to 62.3%. The employment-population ratio was steady at 59.6%, suggesting little improvement in labor utilization despite modest gains in the workforce.

Wage growth remained steady, with average hourly earnings rising 0.3% mom and up 3.7% over the past year. While pay increases are holding, the weak job creation numbers highlight the Fed’s dilemma: inflation may be edging down, but labor market cooling is becoming more pronounced.

Full US NFP release here.

The GBP/USD pair found stability on Friday, trading around 1.3453 as anxiety in the debt markets eased. Investor attention has shifted firmly to the upcoming US non-farm payrolls report, with softer US labour data reinforcing expectations of a Federal Reserve rate cut by year-end.

The latest ADP employment report showed the US economy added just 54,000 jobs in August, well below the forecast of 65,000 and July’s figure of 104,000. The dollar faced additional headwinds from a decline in job openings, which fell to their lowest level since September 2024, and a rise in unemployment claims to a two-month high.

Domestically, the pound remains sensitive to uncertainty surrounding the autumn budget, due in November. Market participants also noted remarks from Bank of England Governor Andrew Bailey, who emphasised “significant uncertainty” regarding the timing of interest rate cuts in the UK.

Interest rate futures currently imply no further policy changes this year, with the first cut not fully priced in until April.

Technical Analysis: GBP/USD

H4 Chart:

On the H4 chart, GBP/USD has completed an upward wave to 1.3460. The pair may now extend this movement towards the resistance level at 1.3548. Following a corrective phase, a rebound from this resistance could trigger a new downward wave, with initial support expected at 1.3420 and further downside potential toward 1.3340. This view is supported by the MACD indicator: both the histogram and signal line remain below zero but are rising.

H1 Chart:

On the H1 chart, the pair tested 1.3460 and continues its corrective advance. The near-term upside target remains the 1.3548 resistance level. A rejection at this level could signal a resumption of the broader downtrend. The Stochastic oscillator corroborates this outlook, with its signal line hovering near 80.0 – indicating overbought conditions and a potential reversal.

Conclusion

The pound has paused its decline amid calmer debt markets and a weaker dollar, though domestic fiscal and monetary uncertainties linger. Technically, the pair shows potential for limited near-term gains followed by a bearish reversal. All eyes now turn to the US NFP report for clearer directional cues.

The price actions of the GBP/USD have shaped the expected minor corrective decline in the past two sessions to print an intraday low of 1.3333 on Wednesday, 3 September, just whiskers above the pre-defined 1.3315/1.3280 key medium-term pivotal support highlighted in our last publication.

Let’s now determine its next short-term (1 to 3 days) directional bias and key levels to watch as we await the key US labour data release: non-farm payrolls and unemployment rate for August at 1230 GMT today.

Fig. 1: GBP/USD minor trend as of 5 Sep 2025 (Source: TradingView)

Preferred trend bias (1-3 days)

The minor corrective decline of -1.9% (high to low) of the GBP/USD that spanned from 14 August 2025 high to 3 September 2025 low may have ended.

Bullish bias above 1.3395 key short-term pivotal for the next intermediate resistances to come in at 1.3545, 1.3590/1.3610, and 1.3650/1.3680.

Key elements

• The GBP/USD has shaped a minor bullish reversal right above the lower boundary of the medium-term ascending trendline in place since 13 January 2025 low on 3 September 2025.
• The hourly RSI momentum indicator of the GBP/USD has just staged a bullish breakout above a parallel descending resistance and flashed an earlier bullish divergence condition at its oversold region on 3 September 2025.
• The 1.3395 key short-term pivotal support is defined by a former minor swing high formed on 2 September 2025 during the US session and the 61.8% Fibonacci retracement of the ongoing minor rally from the 3 September 2025 low to the current intraday high of 5 September at the time of writing.
• The 2-year yield spread premium between the UK gilt and US Treasury note has continued to expand (inched higher) since the 3 September 2025 level of 0.29% to a current level of 0.37%. These observations suggest that short-term UK gilt is relatively more attractive than US Treasury notes in terms of yield differential, in turn, putting upside pressure on GBP/USD.

Alternative trend bias (1 to 3 days)

A break below 1.3395 in GBP/USD would invalidate the bullish outlook, opening the door to a minor corrective decline toward the key medium-term support zone at 1.3315/1.3280.

The Canadian dollar has edged lower on Friday. In the European session, USD/CAD is trading at 1.3793, down 0.19% on the day. We could see stronger movement from the Canadian dollar later in the day, as Canada and the US release the August employment reports.

Canada's employment expected to rebound

Canada's labor market took a beating in July, with the loss of 40.8 thousand jobs, including 10 thousand job losses in manufacturing. The markets expect a rebound in August, with an estimate of 7.5 thousand new jobs. The unemployment rate is expected to tick up to 7.0% from 6.9%.

The weak July reading was directly attributable to the US tariffs, which have hurt the Canadian economy. The US has slapped 35% tariffs on many Canadian products and Canada ships some 75% of its export to its southern neighbor. The two sides are yet to reach a trade agreement but Canada can ill afford a protracted trade war with the US.

Markets brace for weak US NFP

All eyes are on today's US employment report. With inflation largely under control, nonfarm payrolls are closely monitored and could move the US dollar.

The markets are expecting virtually no change in nonfarm payrolls, with an estimate of 73 thousand for August after a gain of 75 thousand in July. The labor market is clearly cooling as employers remain cautious in an uncertain economic environment. The unemployment rate is expected to edge up to 4.3% from 4.2%, which would be the highest level since December 2021.

The Federal Reserve is virtually certain to lower rates at the September 17 meeting, but a weak nonfarm payrolls report would likely lead to calls for the Fed to respond with a jumbo half-point cut.

USD/CAD Technical

• USDCAD has pushed below support at 1.3798 and is testing 1.3798. Below, there is support at 1.3784
• There is resistance at 1.3819 and 1.3826

USDCAD 4-Hour Chart, September 5, 2025

WTI oil remains in red for the third consecutive day and holding near two-week low on Friday, deflated by signals that OPEC+ will announce further production increase in its meeting over the weekend and unexpected rise in US crude inventories.

Lower demand as US summer driving season ends, also contributed to weaker near-term picture.

Oil is on track for a weekly loss after two weeks in green and probes again through cracked important Fibo support at $63.19 (61.8% of $61.44/$66.01 upleg), with firm break here to confirm fresh bearish signal for attack at $62.52 (Fibo 76.4%) and unmask key support at $61.44 (Aug 18 low).

Daily MA’s remain in full bearish setup, falling 14-d momentum is flirting with the centreline, which points to negative outlook, though some headwinds to be anticipated as Stochastic entered negative territory.

Broken 20DMA / 50% retracement $63.50/73 respectively) should ideally cap and keep immediate bears intact, also guarding first upper pivot at $64.38 (daily Tenkan-sen).

Res: 63.50; 63.73; 64.00; 64.48.
Sup: 62.52; 61.82; 61.44; 60.71.