The US economy added only 173k jobs in August missing expectations to have added 220k! The economy added the smallest number of jobs in the last five months. However, the market overshadowed the number easily on the back of the unemployment rate that fell below expectations to a more than 7‐year low at 5.1% from 5.3% before. The average hourly earnings on a monthly basis rose by 0.3%, the steepest pace in the last seven months. August’s employment report sends mixed signals for Fed’s interest rate decision in two weeks.
The euro has recovered against the dollar after falling slightly below the psychological level of 1.1100 following the NFP report. Intraday bias in EUR/USD remains on the downside as the fall from 1.1715 continues. Looking at the daily chart, the 50‐SMA and the 200‐SMA both are providing a significant support to the price action around the 1.1080 level. A break below the 1.1080 level should add further pressure to the pair and would likely move towards the 1.1020 barrier.
Better than expected unemployment and Non‐Farm Payrolls report have given support to the greenback. Amid the release, the GBP/USD pair rallied up to 1.5270 and there the bears took control of the trend and pushed for new daily lows below the support of 1.5200. We expect the prices to continue declining towards 1.5170 followed by 1.5090. On a daily basis, the prices are traded way below the 7‐SMA as this is another signal for strong bearish pressure.
Intraday bias in AUD/USD remains on the downside for the moment. The pair fell below the 0.6980 and is now moving more aggressively towards the psychological level of 0.6900. It is very remarkable that the price is trading below some significant obstacles including the ascending trend line which started back in 2000 as well as below the 61.8 Fibo Level from 2008 lows. We remain strong bearish on the AUD/USD until the end – 0.6200!
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