EUR/USD retakes 1.0500 and beyond on ADP
EUR/USD has reverted the earlier drop to the 1.0480 region and is now regaing the 1.0500 handle and above. Spot gathered some traction after US ADP report showed the private sector has created 153K jobs during December, missing forecasts for a 170K gain and down from November’s 215K (revised from 216K). Further data from the US labour market saw Initial Claims rising to 235K WoW, bettering estimates and taking the 4-Week Average to 256.75K from 262.50K, while Challenger Job Cuts rose to 33.6K in December from 26.9K. The recovery in the greenback has run out steam around the 102.50 area when tracked by the US Dollar Index, receding to the current 102.15/10 band following the results in the US calendar. Later in the NA session, Markit’s Services PMI and the ISM Non-manufacturing will take centre stage. The pair is now up 0.37% at 1.0527 and a breakout of 1.0575 (high Jan.5) would target 1.0654 (spike Dec.30) en route to 1.0681 (55-day sma). On the downside, the immediate support aligns at 1.0478 (20-day sma) followed by 1.0387 (low Jan.4) and finally 1.0350 (2016 low Dec.20).
GBP/USD steady above 1.2300 handle after mixed US data
The GBP/USD pair held its neutral bias around 1.2300 handle, albeit witnessed a volatile 35-40 pips swing after mixed US economic releases. ADP report released on Thursday showed, US private sector employers added only 153K new jobs in December. The reading was worse than 215K jobs reported last month and 170K expected and extended little support to the greenback. The negative impact, however, seems to have been negated by better-than-expected weekly jobless claims, which more-than-expected to 235K for the week ended Dec., down from previous week’s 263K, and continued reflecting the underlying strength in the US labor market. Today's mixed US labor market reports might have done little to scale down market expectations for Friday’s official NFP print, which is expected to show addition of 175K new jobs in December.The data provided little impetus and the pair remained closer to upbeat UK services PMI-led recovery move to 1.2315-20 region. Next of relevance would be the US ISM non-manufacturing PMI for December, due later during the day. On a sustained move above 1.2325-30 immediate hurdle, the pair is likely to make a fresh attempt to clear session peak resistance near 1.2360 region and head towards reclaiming 1.2400 handle. Alternatively, renewed weakness back below 1.2290 horizontal zone might now drag the pair below session low support near 1.2275-70 region towards testing its next important support near 1.2225-20 area.
USD/JPY keeps red below 116.50 after ADP report
The USD/JPY pair stalled recovery from three-week lows and ran through some offers after disappointing US private sector employment data. Currently trading around 116.35 region, ADP report showed private sector added only 153K new jobs in December, worse than 170K expected and 215K jobs added in November. Today’s disappointing report on private sector employment might now raise barriers for the official monthly jobs report (NFP), slated for release on Friday, which would be looked upon to reinforce market expectations of stronger US economic growth and tighter Fed monetary policy stance in 2017. Next on tap would be the US ISM non-manufacturing PMI, which is expected to have eased to 56.6 in December from 57.2 recorded in the previous month. A follow through buying interest above 117.00 handle has the potential to continue boosting the pair further towards session peak resistance near 117.40-45 region. On the downside, 116.50 level now becomes immediate support, which if broken might drag the pair back below 116.00 handle towards retesting session lows support near 115.65-60 region.
Gold well-bid near 4-week highs
Gold extended its recent recovery trend from 10-month through and rose for the third consecutive session in the new-year to touch the highest level since Dec. 7. Currently trading around $1173 level, having posted a session high at $1179, the precious metal gained fresh traction on Thursday as the US Dollar extended its retracement from a 14-year high, touched earlier this week, after the Fed minutes showed high dependency on expected fiscal measures by Trump administration. A weaker greenback lends support to dollar-denominated commodities, including gold. In addition to this, persistent weak sentiment surrounding European equity markets provided additional support to the yellow metal's safe-haven appeal, lifting it the highest level in almost a month. However, a minor bounce back in the US treasury bond yields seems to have restricted further upside for the non-yielding precious metal. Moving ahead, today's ADP report would provide an early estimate for the official monthly jobs report and might provide fresh impetus. However, the broader trend would remain dependent on US Dollar price dynamics, which would take fresh cues from Friday's NFP data and would eventually help investors to determine the next leg of directional move for gold prices. Momentum above session peak resistance near $1180 level is likely to confront resistance near $1183-85 region ahead of $1190 resistance above which the metal seems all set to head towards 50-day SMA resistance near $1200 handle. On the flip side, $1168 level is likely to act as immediate support, which if broken is likely to accelerate the slide towards session low support near $1163 region, en-route $1150 important support.
USD/CHF hits fresh session low below 1.0150 level
The USD/CHF pair's recovery move lost steam near 1.0220 region and is now heading back towards the lower end of daily trading range. Currently trading around 1.0140 level, testing session lows, the pair ran through fresh offers after disappointing ADP report that showed US private sector employers added 153K new jobs in December, worse than 170K expected and November's 215K. Meanwhile, the number of people claiming for employment related benefits unexpectedly dropped to 235K for the week ended Dec. 30, down from 263K reported in the previous week and was far less-than 260K expected. A higher-than-expected drop in weekly jobless claims failed to contribute in limiting the damage and the pair was seen fast approaching last week’s swing lows. Today's mixed labor market report, however, did little to dent the greenback’s well-established bullish trajectory, albeit might now be increasingly reliant on Friday's official NFP data. Next on tap would be the US ISM non-manufacturing PMI print for December, due in a short while from now. A follow through selling pressure below 1.0150 could accelerate the slide towards 1.0125 level (Dec. 30) before the pair eventually breaks below 1.0100 handle and head towards testing 50-day SMA support near 1.0075 region. On the upside, 1.0200 handle now becomes immediate hurdle, which if cleared might trigger a short-covering rally towards 1.0230 resistance, en-route 1.0270-75 strong resistance.
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