Hello traders, welcome to Thursday’s trading session. The economic calendar is packed today, with a major focus on the European Central Bank’s (ECB) interest rate decision. A 25 basis point cut is widely expected, which could have a significant impact on the euro and broader market sentiment. Later, the U.S. unemployment claims report is expected to show 234,000 new claims, while Canada’s Ivey PMI is forecasted at 50.6, adding further potential catalysts for volatility.
The market is already showing notable price swings ahead of these key events. The most interesting setups appear on indices, particularly U.S. benchmarks like the NASDAQ and S&P 500, which have formed V-shaped reversals over the past two days. Historically, these patterns have led to strong upside movements, but today’s European session has opened with declines, indicating that sellers remain active and buyers are still under pressure.
In the currency market, the U.S. dollar is under extreme weakness, making it the worst-performing currency of the week. On the other hand, the euro has surged 2% over the past three days, a significant move in the forex market. Other European emerging market currencies, such as the Polish zloty, Hungarian forint, and Czech koruna, are also gaining strength. Meanwhile, the Japanese yen is experiencing a mild rebound, though it appears to be more of a correction than a trend reversal.
Commodities are also seeing significant moves. Oil remains under pressure, continuing its downward trend, despite a minor bullish reversal today. This week, oil is down 3%, highlighting ongoing weakness. In contrast, metals have been performing well overall, despite some pullbacks today. Copper has gained 3% since Monday, while silver is up 2%, making this a strong week for the sector.
As the day unfolds, all eyes remain on the ECB decision and U.S. data releases. But the biggest event of the week is still ahead—Friday’s non-farm payrolls (NFP) report, which could set the tone for the markets going forward. Stay prepared for heightened volatility and sharp market reactions.