GBP Employment numbers today the major focus. Weaker numbers puts pressure on the BOE to cut rates!

Hi there, traders, this is Brad Goodwit with today's trading action. All right, now as we move through into Tuesday's trading, the UK employment will be the major focus. Now, there's been no major news, so if you're looking across the news pages, it's more like a bit of a summary here, there, and everywhere, right? Sterling pauses as traders await key UK economic data, et cetera, right? So there's not a lot going on just at the moment, but it will heat up. Now, if you look in your charts, that's clearly evident, right? A lot of things are just trading sideways, but Sterling, well, it's got a little bit of a, a little bit of an upward bias at the moment. Aussie and Kiwi have sort of broken high, but sort of drifting sideways. Dollar CAD, well, the Canadian dollar's rallied, and that weaker US dollar, really sort of getting pounded there. Oil back at almost 80 bucks is keeping the dollar CAD on the downside. Dollar Yen drifting sideways, but interestingly, like Dollar Swiss was a lead, you know, before the big Yen move and everything else, and we are starting to see a drift sideways just through a very short-term sort of support trend line. I'm just wondering if this is the catalyst for the move to the downside once again, and Dollar Yen's right there on the cloud. It sort of lines up, right? But we'll have to see how that plays out. Now, let's just have a look at, now, the major focus for today. Now, there's a couple of things coming out. The wage price index numbers out of Australia, this is an inflation number, right? So, probably important. Will it move the Aussie around? Maybe, maybe not, but it's just worth keeping an eye on, especially if you're in Australasia. All right, now, let's just have a look at the key numbers here. So, employment numbers. Now, they are a calamity, as you know. Unemployment rate is sort of one of the focuses. The 4.5% is the expected poll. 4.3 to 4.5 is the range there, right? So, and then you've got the employment change looking for 3,000, which is like, why would you even post the data? But the range minus 40 to 33K, right? And then you've got those extra little components, average earnings, et cetera, once we see what's going on. So, this is important because, I know we've got UK inflation numbers tomorrow, right, the next day, but just sort of having a look here at the Bank of England probability distribution for interest rate changes. So, at the moment, this upcoming meeting, right, it's a lot, well, it was a line ball. I was gonna say, it's almost a line ball. 37% for a cut, 62% no change, right? Today's UK employment numbers and tomorrow's UK inflation numbers will go a huge way in determining what the Bank of England does at the next meeting, right? So, that makes it an actionable event, right? So, and more specifically, probably the UK inflation. But that's what we need to be focusing on and just having a quick look across sterling on the hourly charts, drifting lower and sort of just starting to come back a little bit, right? And if you're looking at the daily charts, okay, it's a little bit more of a different picture. We had that strong rally to the top side. It's back in the range, but looking to sort of break back out again. And it is sort of coming back from an overboard situation. So, you know what, sterling, it looks like there's opportunities. Now, on the sterling crosses, it's a little bit different, right? Sterling has given up a lot of ground here. Euro came back, Aussie came back. Sterling fell against the Kiwi. Basically, sterling fell against everything as the data became weaker. Now, there is a perception out there that lower interest rates will generate growth and that will happen, but the impact of the weaker interest rate differential against the other currencies is clearly evident. Now, sterling yen, just like dollar yen, sort of hanging in there, right? Like it's sort of slowly climbing, but this is the yen trade, right, the carry trade. So if we're thinking, and this is probably gonna be more relevant tomorrow with the UK inflation numbers, right? Now, if we get weaker UK inflation numbers, pushes them more towards a cut and the carry trade as far as sterling yen is concerned is a little bit less and that might be the catalyst for the move to the downside in sterling yen. So maybe a preemptive move if today's employment numbers are really terrible. Right, sterling against the Swiss. Well, sterling has come down against everything, but it's sort of battling away there, not doing too much at the moment. And just having a look at the risk reversals, right? And if I look at sterling here, right? The still a predominance or the market's preference is to be buying puts, right? Puts are all the rage at the moment. So the market doesn't expect any sort of significant rallies at this stage. Volatility though, also one month and three month up a little bit as well. So gonna be volatile, but at the moment we wanna see what this data does if it changes the market's perception about where sterling's going. At the moment, the risk reversals suggest we are heading south, right? So that's interesting to see how the market is covering itself, all right? Global markets dashboard, if I just have a quick look at that for today, US equity futures up, currencies a little bit mixed, okay? The not all the, it's not sort of going on with a clear risk on risk off sentiment. US treasuries, well, I'd say if anything a little bit lower, if not stable. So it matches up, but we're not seeing clarity across the major currency pairs at the moment. The risk on risk off pairs, not exactly lining up. The safe havens though are, right? Gold, Swiss, yen, Bitcoin, they all look a little positive, right? So as we come into a big event like the UK and US CPI numbers, that could be something to keep an eye on there as well. Oil trade, well, it's in play there at the moment and something worth keeping an eye on because it is still charging to the top side. All right, guys, well, that's it from me. Bit of a quick wrap on today's trading action. Make sure you focus in on the UK data. Don't forget, there are a number of variables here. The old number here, the climate count change has really taken a back step. I like the new framework, employment change and the unemployment rate. And don't forget those ranges, right? And those average earnings can come in and mess things up. But you know what? If we get all weak or all strong data, we've got some action, right? If we get, most of the market at the moment is predicting that the Bank of England stays on hold. So to me, where the risk is, it's a weakened numbers, right? You're looking at a number above 4.5 and a number like minus 40 would be great. That would put the pressure on the Bank of England and really line up tomorrow's UK CPI numbers for a big hit at the market. All right, guys, that's it from me. Have a good day. All the best. Cheerio.