Currency Updates:
U.S. Dollar Trading (USD) was supported by heavy selling in the EUR/USD which overflowed into other majors. Weekly Jobless claims were ok at 370k vs. 380k forecast but traders will be looking to tonight’s Nonfarm Payroll number for a better indication of the US labor market. The US FOMC meet next week and this number will be critical for the Dollar’s next direction. Looking ahead, November NonFarm Payrolls forecast at 93k vs. 171k previously. The Unemployment Rate is forecast to remain at 7.9%.
The Euro (EUR) was crushed lower after being hit by dovish comments at the ECB meeting press conference. The ECB lowered its 2013 GDP forecasts but the major comment that traders picked up on was that the OMT was only to be used in emergencies and not to lower yields. The uptrend is under threat from the correction lower on the major and Euro Crosses. The Sterling (GBP) was dragged lower be the Euro slump but we have found support at 1.6050 on Cable. EUR/GBP fell below 0.8100 and has traded as low as 0.8070 so far in Asia. The outlook is mixed with bulls cautious given the new Euro developments and US NFP today. The BOE met and kept rates at 0.5% as widely forecast. Looking ahead, ECB President Draghi Speaks. Also German Industrial Output forecast at -0.5%m/m vs. -1.8% m/m/
The Japanese Yen (JPY) USD/JPY was sidelined while the action was taking place on the EUR/USD overnight. EUR/JPY slumped inline with the major and is threatening the uptrend if we falls for a second day. USD/JPY is always a big mover when the US Jobs data is released and traders will be watching the pair closely. Australian Dollar (AUD) the AUD/USD broke briefly above 1.0500 overnight but we find ourselves back down at 1.0480 once again with the EUR/USD slumping. The slow grind higher will require EUR/USD support to get back above the 1.0500. Australian November Jobs data was solid with +13.9k and the Unemployment Rate dropped to 5.2% vs. 5.5% previously. Update October Trade Balance at -2088mn vs. -1456mn previously.
The Sterling (GBP) was dragged lower be the Euro slump but we have found support at 1.6050 on Cable. EUR/GBP fell below 0.8100 and has traded as low as 0.8070 so far in Asia. The outlook is mixed with bulls cautious given the new Euro developments and US NFP today. The BOE met and kept rates at 0.5% as widely forecast. Looking ahead, ECB President Draghi Speaks. Also German Industrial Output forecast at -0.5%m/m vs. -1.8% m/m/
Australian Dollar (AUD) the AUD/USD broke briefly above 1.0500 overnight but we find ourselves back down at 1.0480 once again with the EUR/USD slumping. The slow grind higher will require EUR/USD support to get back above the 1.0500. Australian November Jobs data was solid with +13.9k and the Unemployment Rate dropped to 5.2% vs. 5.5% previously. Update October Trade Balance at -2088mn vs. -1456mn previously.
Oil & Gold (XAU) Gold reclaimed $1700 but failed to close above the figure with sellers still in control for now. The NFP is another big mover for Gold so expect volatility post release. OIL/USD fell sharply down to $86 with the recent failures on the topside prompting a downside test.
