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U.S. jobs & wages report missed expectations on most metrics, including headline NFP figure. U.S. dollar spiked lower immediately after the release but recovered in the following hours to be now back above pre-release levels. Only Canadian dollar has been defying gravity to some degree with the help of its own jobs report.
al_dcdemo's Blog
USD/JPY proves resilient once again
U.S. jobs & wages report for August fell short of expectations on most metrics. August is historically weak with regard to NFP figure but Wednesday's strong ADP figure gave U.S. dollar bulls some hope that this time was different.
It wasn't and the immediate reaction was to sell the dollar. The report itself was not great but was solid enough and subsequent price action seemed to agree. USD/JPY is ending the day and the week near highs and above 110.
It wasn't and the immediate reaction was to sell the dollar. The report itself was not great but was solid enough and subsequent price action seemed to agree. USD/JPY is ending the day and the week near highs and above 110.
Cable slows into 1.30
Cable has looked heavy since last Thursday's BOE meeting. Friday's NFP report didn't do it any favours. The pair has posted five consecutive down days since last Wednesday.
That said, bears were not really convincing so far this week as was not yesterday's (fake) breakout below 1.30. A sustained hold below the big level will be needed or else we may see a larger short squeeze.
That said, bears were not really convincing so far this week as was not yesterday's (fake) breakout below 1.30. A sustained hold below the big level will be needed or else we may see a larger short squeeze.
NFP day ahead
Tomorrow is a NFP day and, following recent dovish turn by the Fed, I would expect more U.S. dollar losses on a weaker than expected report than gains on a better than expected report.
If I'd have to guess, I'd say we would get overall slightly better than expected report. Price action would depend on the pair, but would probably involve taking out stops on both sides with the dollar ending up near unchanged on the day.
If I'd have to guess, I'd say we would get overall slightly better than expected report. Price action would depend on the pair, but would probably involve taking out stops on both sides with the dollar ending up near unchanged on the day.
Dollar bears take some profits after the NFP
A weak week for the dollar ended with dollar strength. Despite the miss in the headline non-farm employment number, it was overall a decent jobs and wages report with unemployment down and average hourly earnings up.
Initial response to the report was to sell the dollar but the moves were soon reversed. Commodity currencies were hit the hardest while the yen is poised to close near unchanged for the day as both stocks and oil sold off.
Initial response to the report was to sell the dollar but the moves were soon reversed. Commodity currencies were hit the hardest while the yen is poised to close near unchanged for the day as both stocks and oil sold off.
Yen pulling back
After a fake move to the upside on Monday, Yen has been heading lower. It posted four consecutive days of losses and has given back more than half of the gains that it made since last Friday's NFP report.
122 is the level to watch. If it holds, the pair may rally again to retest 124 - 125 in the days ahead. If it gives way, a return to 118 - 122 range will become the most likely scenario. A lot of that will depend on what stock markets will do in the near future.
122 is the level to watch. If it holds, the pair may rally again to retest 124 - 125 in the days ahead. If it gives way, a return to 118 - 122 range will become the most likely scenario. A lot of that will depend on what stock markets will do in the near future.
The Yen bid into NFP
Since it broke above 50 DMA in October 22th, the Yen has been behaving bulllishly. It rose in every day of this week so far, convincingly breaking above 200 DMA. However, weekly range has been relatively small (~170 pips) as the pair has been slowly grinding up towards 122 resistance.
Action following tomorrow's NFP report could well see that level break, if we'll finally get a decent one. Weekly gains could also be easily erased with the price pulling back towards 120.50, should there be a cont…
Action following tomorrow's NFP report could well see that level break, if we'll finally get a decent one. Weekly gains could also be easily erased with the price pulling back towards 120.50, should there be a cont…
EURo's rally unconvincing
Following poor NFP report, strongly rally and a decent pullback on Friday, Euro started the week as expected and rose 80+ pips from the open. The rally stalled ahead of resistance band at 1.1300 - 1.1325 (00's, Daily Resistance 1, Weekly Resistance 1, Previous Week High).
It pulled back and is finding some support between 1.1235 and 1.1250 (H4 200 SMA, 50's, H4 100 SMA, Monthly Pivot Point). If it doesn't turn back up from here, 200 DMA (~1.1170) may come back into focus.
It pulled back and is finding some support between 1.1235 and 1.1250 (H4 200 SMA, 50's, H4 100 SMA, Monthly Pivot Point). If it doesn't turn back up from here, 200 DMA (~1.1170) may come back into focus.
Yen continues sideways ahead of the NFP
Yen continues to consolidate around 120 level which acts as mid point of a symmetrical triangle. Daily range gets smaller every day as the pair moves sideways. This kind of pattern typically breaks when price is in it's last third. Following a breakout there may be potential for up to 300 pips to either side of the pattern. Tomorrow's NFP report may well provide a decent impetus for a breakout.
Support:
119.25 - 119.50 (Daily Support 1, 50's, Previous Day Low, Weekly Support 1, The Pattern Botto…
Support:
119.25 - 119.50 (Daily Support 1, 50's, Previous Day Low, Weekly Support 1, The Pattern Botto…
Yen pulls back
Risk trades bounced a bit overnight. USD/JPY managed to pull 80 pips from the intraday low and 100 pips from the Friday's (post-NFP) low. With US on holiday today, we may have to wait until tomorrow to get the whole picture.
Resistance is seen at 119.60 - 119.65 (High Of Day, post-NFP high, Thursday's low) and then at 119.90 - 120.00 (Trendline drawn off of August 19th/28th and September 3th highs, Daily Resistance 1, 00's). There's some support near 119.20 - 119.25 (Intraday pivot, Daily Pivot …
Resistance is seen at 119.60 - 119.65 (High Of Day, post-NFP high, Thursday's low) and then at 119.90 - 120.00 (Trendline drawn off of August 19th/28th and September 3th highs, Daily Resistance 1, 00's). There's some support near 119.20 - 119.25 (Intraday pivot, Daily Pivot …