The dovish remarks by the ECB president yesterday were taken as confirmation for the market’s credo: Eurozone interest rates might possibly weaken by year end, further closing the gap to U.S. rates, where the possibility of a rise increases with an economy hopefully gaining again soon. The dollar gained further ground on that, only pausing in early European trading to catch its breath.

Today`s release of U.S. employment figures might strengthen the dollar further. Expectations call for an unchanged rate for the unemployment rate for August, and a further decrease in nonfarm payrolls (both at 14:30 CET).

Intraday Market Outlook for Day Traders

EUR / USD
The euro rebounded somewhat against the dollar in late Asian trading, only to fall back near the support zone at 1.4200 and is currently trading at 1.4240. We expect the 1.4200 level to hold in today’s trading and see an upper limit for corrections at 1.4350.

GBP / USD
The pound is just in another upward correction in its long bear market against the dollar and is currently trading at 1.7640. We see it trading today near resistance at 1.7700 before further pressure can set in.

USD / CHF
This pair, currently trading at 1.1140, will probably try to break its recent highs at 1.1170 in the coming trading hours. Before that, we expect it to fall back somewhat, hitting 1.1120.

USD / JPY
The dollar weakened further against the yen and is currently trading at 106.44, reflecting more unwinding of the carry trades. We see that development fading before the weekend in today’s trading but have no forecast beyond the 107.00 level for possible upmoves.