Previous session overview
On Thursday, the dollar lost ground for a second straight day against many of its main rivals, including the euro and the yen, on worries about the U.S. job market and economic outlook.
On Thursday morning, the EURUSD pair showed again an indecisive trading pattern. At the start of trading in Europe, the pair dropped from the 1.3650 area to the 1.3550 area. Sentiment changed as soon as US traders got involved. Growing investor nervousness gradually brought the dollar under pressure. After US data showed a steep rise in US continuing claims, EURUSD spiked to the 1.3800area. EURUSD closed the session at 1.3700 compared to 1.3644 on Wednesday.
The British pound remained strong on Thursday, gaining against every major currency except the Japanese yen and Canadian dollar, despite the fact the Bank of England cut the Bank Rate.
The Japanese Yen continued to pullback on the USDJPY as the markets reacted to stock weakness in Asia and crosses were heavy lead by the AUDJPY and other higher yielding pairs.
The Australian dollar nudged higher in lackluster Asia trading Friday, as traders stayed firmly on the sidelines ahead of much awaited U.S. employment data due later Friday. The Australian dollar was quoted at USD0.7070 up from USD0.7057 late Thursday. Against the Japanese yen, it was quoted at JPY64.535, down from JPY65.285.
Market expectation
The euro is lower Friday, as investors grabbed cheaper dollars after their recent decline.
For EURUSD resistance remains placed between USD1.3690/00 (USD1.3695 38.2% USD1.3801/1.3630), a break above to open a move on toward USD1.3720 ahead of USD1.3730/35 and USD1.3750/60. Stronger resistance seen placed around USD1.3800 with stops above. Support USD1.3630, stronger toward USD1.3600 with stops below.
While the dollar could suffer from another bout of selling on poor payroll data Friday, a smaller number of job losses are likely to turn into the dollar's favor, some currency strategists noted.
Non-farm payrolls for December are expected to show the world's largest economy shed 525,000 jobs in December, illustrating economic woes which many expect to deteriorate further in the coming months. If U.S. jobs losses exceed the median forecast, currencies and bond markets may not move much as traders will have been expecting bad news.
Most important events of the day
| Date | Time:GMT | Currency | Indicator | Forecast | Prior |
| 1/9/2009 | 5:00 | JPY | Leading Indicators | 81.40% | 85.20% |
| 1/9/2009 | 7:00 | EUR | German Retail Sales m/m | 0.40% | -2.20% |
| 1/9/2009 | 7:45 | EUR | French Trade Balance | -6.2B | -7.1B |
| 1/9/2009 | 7:45 | EUR | French Industrial Production m/m | -0.70% | -3.70% |
| 1/9/2009 | 8:00 | EUR | ECB President Trichet Speaks | ||
| 1/9/2009 | 9:30 | GBP | PPI Output m/m | -0.70% | -0.70% |
| 1/9/2009 | 9:30 | GBP | Industrial Production m/m | -0.50% | -1.70% |
| 1/9/2009 | 9:30 | GBP | PPI Input m/m | -2.00% | -3.30% |
| 1/9/2009 | 9:30 | GBP | Manufacturing Production m/m | -0.50% | -1.40% |
| 1/9/2009 | 10:00 | EUR | Retail Sales m/m | 0.10% | -0.80% |
| 1/9/2009 | 11:00 | EUR | German Industrial Production m/m | -2.00% | -2.10% |
| 1/9/2009 | 12:00 | CAD | Employment Change | -21.0K | -70.6K |
| 1/9/2009 | 12:00 | CAD | Unemployment Rate | 6.50% | 6.30% |
| 1/9/2009 | 13:15 | CAD | Housing Starts | 170K | 172K |
| 1/9/2009 | 13:30 | USD | Average Hourly Earnings m/m | 0.20% | 0.40% |
| 1/9/2009 | 13:30 | USD | Unemployment Rate | 7.00% | 6.70% |
| 1/9/2009 | 13:30 | USD | Non-Farm Employment Change | -520K | -533K |
| 1/9/2009 | 13:30 | CAD | Building Permits m/m | -4.50% | -15.70% |
| 1/9/2009 | 15:00 | USD | Wholesale Inventories m/m | -0.80% | -1.10% |
| 1/9/2009 | 17:30 | USD | FOMC Member Lacker Speaks |
