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US Claims Data Fuels Optimism For Friday's Non Farm Payrolls

Fri, Jan 8 2010, 10:20 GMT
by Peter Rosenstreich

ACM - Advanced Currency Markets  |  View company's profile

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Market Brief

For a fourth day in a row, the early USD trend in the Asian session has been reversed during the subsequent European trading hours; as the USD index has rallied higher to 77.95 levels and EURUSD has slumped back from 1.4447 highs to 1.4325 currently. The move in the EUR has been exacerbated by poor European data releases earlier in the morning which weighed on risk appetite; the dismal print in German Retail Sales at -1.1% (vs. 0.3% expected) served as a precursor for the large downside miss in Eurozone Retail Sales later on (-1.2% vs. 0.0% expected), and Germany Factory Orders were also sharply off (0.2% MoM vs. 1.5% expected). Consumer Confidence data was in line with forecasts at -16, but in absolute terms, still a weak reading.

As expected, the Bank of England kept interest rates on hold at 0.50% and made no amendments to their asset purchase target; GBP was largely unaffected over the announcement, with next month’s MPC meeting likely to be the more influential on investor sentiment. GBPUSD has traded between 1.5897 – 1.6058 so far today, and we believe any rallies will likely meet plenty of selling interest towards the 1.6050 resistance.

The afternoon session has seen equity markets struggle to make much positive progress; but very encouraging US claims figures have added to anticipation for tomorrow’s crucial Non Farm Payrolls release. Both the Initial Claims (434k vs. 440k expected) and Continuing Claims (4802k vs. 4975k expected) were better than estimates, and if tomorrow’s consensus for a 0k change in payrolls is realized, it will represent the first non-negative print in over 2 years. Other highlights in the day ahead include Norway Retail Sales, UK PPI and Eurozone Unemployment.

Currency Tech

EURUSD
R 2: 1.4500
R 1: 1.4485
CURRENT: 1.4315
S 1: 1.4232
S 2: 1.4210

USDJPY
R 2: 94.50
R 1: 93.40
CURRENT: 93.15
S 1: 91.10
S 2: 90.40

GBPUSD
R 2: 1.6335
R 1: 1.6240
CURRENT: 1.5920
S 1: 1.5900
S 2: 1.5833

AUDUSD
R 2: 0.9325
R 1: 0.9267
CURRENT: 0.9185
S 1: 0.9093
S 2: 0.8900

USDCAD
R 2: 1.0635
R 1: 1.0577
CURRENT: 1.0335
S 1: 1.0267
S 2: 1.0207

• S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot

Published on  Fri, Jan 8 2010, 10:33 GMT

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