Market insight 5 Sep

GBP/USD The inflation in UK is falling, but the real trouble for the Bank of England is the job market. There are clear signs that the peak of last summer has passed, but the labor market has not cooled as quickly as the target of central bank. At the same time, the private sector wage growth has increased to record high, it will raise the risk that inflation will stabilize above goal over the medium term. We can see moving average system has formed dead cross that means potential decline on H4 chart. On the other hand, the MACD double line and histogram bar is converging to constitute golden cross, it is signal of rebound. Overall, the suitable strategy is to set sell limit between 1.2650 to 1.2700. XAU/USD Gold rose to a three-week high in last days and hitting 1953 last Friday after the US nonfarm payroll data released. Although US created more jobs than economists expected, salary growth was weaker than expected and the unemployment rate rose sharply. Some analysts point out that gold currently does not have enough momentum to enter bullish range. As we mentioned before, the gold has shaped top divergence and then dropped. The price is limiting by 12 hours moving average, it means that the rising momentum is weak. In addition, MACD double line and histogram bar is expanding downwards, which may cause further retracement. As a result, the sell limit could be set around 1947.

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