US dollar higher after positive economic data released pointed to strong labour market and postponing of potential future rate cuts.
CURRENCY TRADING SUMMARY –6 NOVEMBER 06 (23:30GMT)
- U.S. Dollar Trading (USD) was stronger against the majors in the Friday night foreign exchange trading session as non-farm payrolls (NFP) disappointed, but upward revisions to previous results was looked at as positive for the USD. NFP rose by 92k in October, below forecasts for a 125k increase. The 51k posted in September was revised up to 148k, and the August result of 188k was increased to 230k. Unemployment fell from 4.6% to 4.4% beating estimates of the rate staying steady at 4.6%. US non-manufacturing ISM rose to 57.1 versus a 54.5 consensus and a previous result of 52.9. In other markets, the Dow Jones index fell by 32pts and the NASDAQ gave up 3pts. Crude oil rose by US$1.26 to US$59.14 a barrel as warnings arose of an imminent attack on oil facilities in Nigeria.
- The Euro (EUR) traded within a low of 1.2683 and a high of 1.2795, before closing at 1.2716 in the New York session. On the data front, unemployment dropped as forecasted to 7.8% from 7.9% previously. Looking ahead, Eurozone PPI is due out today.
- The Japanese Yen (JPY) traded within a low of 116.95 and a high of 118.19 versus the dollar, before closing at 118.01 in the New York session. Japan enjoyed culture day on Friday.
- The Sterling (GBP) traded within a low of 1.8975 and a high of 1.9125, before closing at 1.9009 in the New York session. On the data front, PMI services came in at 59.3 beating estimates of 56.7. Looking ahead, industrial production is due out today.
- The Australian Dollar (AUD) traded within a low of 0.7686 and a high of 0.7750, before closing at 0.7699 in the New York session. Looking ahead, the RBA begin their 2-day meeting tomorrow to decide on any changes to interest rates.
- Gold (XAU) strengthened by US$1.40 to US$629.20 an ounce as surging oil prices lifted the precious metal.
TECHNICAL COMMENTARY
| Currency | Sup 2 | Sup 1 | Spot | Res 1 | Res 2 | Comments |
| EUR/USD | 1.2662 | 1.2677 | 1.2715 | 1.2800 | 1.2834 | Expect sideways movement before another leg down. |
| USD/JPY | 116.57 | 116.97 | 118.00 | 118.18 | 118.74 | Sideways trading between 108.85-113.00 |
| GBP/USD | 1.8870 | 1.8952 | 1.9015 | 1.9146 | 1.9219 | Break below Sup 2 signals move to 1.7270 |
| AUD/USD | 0.7623 | 0.7671 | 0.7695 | 0.7769 | 0.7795 | .7365 is the target for downtrend. |
| XAU/USD | 598.50 | 614.55 | 627.00 | 629.50 | 640.60 |
- Euro 1.2715
Initial support at 1.2677 (Oct 31 low) followed by 1.2662 (Oct 27 low). Initial resistance is now located at 1.28 (Nov 1 high) followed by 1.2834 (Sep 22 high).
- Yen 118
Initial support is located at 116.97 (Nov 3 low) followed by 116.57 (Nov 1 low). Initial resistance is now at 118.18 (Nov 3 high) followed by 118.74 (Oct 27 high).
- Pound – 1.9015
Initial support at 1.8952 (Oct 30 low) followed by 1.887 (Oct 27 low). Initial resistance is now at 1.9146 (Aug 8 reaction high) followed by 1.9129 (Apr 20, 2005 high).
- Australian Dollar – 0.7695
Initial support at 0.7671 (Oct 31 low) followed by 0.7623 (Oct 27 low). Initial resistance is now at 0.7769 (Nov 1 high) followed by 0.7795 (May 11 trend high).
- Gold – 627
Initial support at 614.55 (Nov 2 low) followed by 598.5 (Oct 31 low). Initial resistance is now at 629.5 (Nov 3 high) followed by 640.6 (Sep 6 high).
