04.06.2021: Market cheers unemployment decline in US (S&P500, DXY, USD/CAD, BTC/USD)

On Thursday, the US stock market was not able to continue its growth. The US benchmark stock indices have been trading in a narrow range for 7 days straight. Analysts are certain that new historic highs are yet to come.
Today the US Labor Department released crucial data on US employment in the public and private sectors, including the jobless rate for May. Investors are inspired that unemployment declined lower than expected. Why is it so positive for the market? Let’s find out!
Obviously, the S&P500 is benefitting from recent upbeat macroeconomic data. According to the nonfarm payrolls, the US labor market added 978,000 new jobs in May. Besides, the ISM services PMI climbed to 64 points last month from 63 in April. President Joe Biden negotiated with Republicans in Congress on his package worth 1 trillion dollars to support the domestic economy and infrastructure. Now he advocates for a 15% minimum corporate tax rate, lower than in the bill from 2017. The proposal will be discussed in Congress on Monday. Meanwhile, the S&P500 is trading at near 4,192 and is expected to hold in the corridor of 4,150 to 4,230. The bullish outlook suggests that the index could hit a new all-time high.
As expected, the US dollar advanced to 1.2130 against the euro yesterday amid growing fears about runaway inflation in the US and the likelihood that the US Fed will revise monetary policy soon. In the morning, the euro/dollar pair dropped to 1.2110 as the US dollar was asserting strength. Its index rose to 90.50 in the American trade. It is likely to hold in a narrow range of 90.15 to 90.80.
In the USD/CAD pair, the loonie could touch the bottom amid the broad-based growth of the US dollar. Analysts reckon that the currency pair might reverse upwards. This scenario will come true if oil prices enter a downward correction. Today the USD/CAD pair is trading at about 1.2115. The expected corridor is from 1.2050 to 1.2180.
We are pleased if our forecasts prove true. According to the chart, Bitcoin climbed to 39,000 dollars and developed a rapid fall. We predicted exactly the same scenario a few days ago. The most popular cryptocurrency is likely to plunge as low as 35,000 dollars per token or even deeper in the long term before it will be able to surpass the level of 40,000 dollars.
Today market participants got to know government data on the US employment for May. The report brought positive news for the market, though the actual figures were a bit lower than expected. Nevertheless, these are rather upbeat data suggesting that American employers could continue strong hiring, pushing the labor market up to one-year highs.
On the political front, we want you to take notice of two news items. First, China is sending a clear message about its interest in the truce in the trade war launched by Donald Trump. Second, Russia has made a step to worsen its relations with the US. The Russian finance minister stated that dollar holdings would be slashed in Russian reserve funds. Moreover, 30% of forex reserves in dollars have been already exchanged for the Chinese yuan.
Follow developments in global financial markets on InstaForex TV channel! Don’t miss our videos!

https://www.instaforex.com

FX Analytics - https://www.instaforex.com/forex_analytics
Forex Calendar - https://www.instaforex.com/forex_calendar
Forex TV from InstaForex - https://www.instaforex.com/instaforex_tv

Forex charts - https://www.instaforex.com/charts
Instant account opening - https://www.instaforex.com/fast_open_live_account
Forex Trading Contests - https://www.instaforex.com/forex_contests

List of official InstaForex blogs:
https://www.facebook.com/instaforex
https://www.instagram.com/instaforex/
https://twitter.com/InstaForex

#forex_news #american_session #instaforex_tv