Attention Turns to the US Jobs Report

U.S. Dollar Trading (USD) in a quieter than usual day of trading the USD was slightly weaker after the Euro rallied and the USD/JPY failed to hold above Y86. Weekly Jobless Claims were are 479k vs. 455k forecast and helped the USD remain supported against risk currencies ahead of tonight NFP report. In US stocks, DJIA -5 points closing at 10675, S&P -1 points closing at 1125 and NASDAQ -10 points closing at 2293. Looking ahead, July Non Farm Employment Change forecast at -65k vs. -125k previously. Unemployment Rate is forecast at 9.6% vs. 9.5% previously.

The Euro (EUR) the Euro rallied to day highs after some strong June German Factory orders at 3.2%m/m at the start of Europe. The ECB held at 1.0% as expected but Trichet was more upbeat and helped support the Euro for the rest of the day. EUR/USD traded with a low of 1.3118 and a high of 1.3237 before closing at 1.3180. Looking ahead, June Industrial Output is forecast at 0.7% vs. 2.6% previously.

The Japanese Yen (JPY) USD/JPY grinded lower for most of the day after an impressive rally on Wednesday. The pair slipped below Y86 on the US Weekly Jobless Claims miss but losses were contained to Y85.80 support. Overall the USDJPY traded with a low of 85.69 and a high of 86.47 before closing the day around 85.90 in the New York session.

The Sterling (GBP) fell sharply going into Europe on weak Barclay's bank earnings but recovered to test day highs on back of the Euro's rally. The volatility continued to with market reversing once more in the US session to test day lows again. The BoE held at 0.5% as widely expected. Overall the GBP/USD traded with a low of 1.5818 and a high of 1.5927 before closing the day at 1.5880 in the New York session. Looking ahead, June Industrial Output forecast at 0.2% vs. 0.7% previously.

The Australian Dollar (AUD) kept to a 40 pip range with downside in the US contained to 0.9120 supports. The market has been grinding higher all week with the market waiting for a fresh catalyst such as tonight's NFP data to break out of the 91-91.80 range. Overall the AUD/USD traded with a low of 0.9195 and a high of 0.9177 before closing the US session at 0.9155.

Oil & Gold (XAU) stayed inside a $10 range with resistance at $1200 hold for a second day. Overall trading with a low of USD$1190 and high of USD $1200 before ending the New York session at USD$1195 an ounce. Fell back slightly after profit taking set in ahead of today's key jobs data. WTI Oil Closed -$0.46 at $82.01 a barrel.

TECHNICAL COMMENTARY

CurrencySup 2Sup 1SpotRes 1Res 2
EUR/USD1.27371.29811.31801.34161.3692
USD/JPY83.5084.7385.9086.6688.12
GBP/USD1.54001.56961.58651.60691.6276
AUD/USD0.88960.90330.91450.92730.9389
XAU/USD1146.001157119512041218.00
OIL/USD78.0080.0082.2082.5085.00

Euro - 1.3180

Initial support at 1.2981 (July 30 low) followed by 1.2737 (July 22 low). Initial resistance is now located at 1.3416 (April 27 high) followed by 1.3692 (April 12 high)

Yen - 85.90

Initial support is located at 84.83 (Nov 29 2009 low) followed by 83.50 (Nov 29 2009 low). Initial resistance is now at 86.66 (August 3 high) followed by 82.12 (July 28 high).

Pound - 1.5865

Initial support at 1.5692 (August 2 low) followed by 1.5400 (July 26 low). Initial resistance is now at 1.6069 (Feb 3 high) followed by 1.6276 (Jan 28 high).

Australian Dollar - 0.9145

Initial support at 0.9033 (Aug 2 high) followed by the 0.8896 (July 22 high). Initial resistance is now at 0. 9273 (May 4 low) followed by 0.9389 (April 12 high).

Gold - 1195

Initial support at 1157 (July 5 low) followed by 1147 (Apr 27 low). Initial resistance is now at 1204 (July 23 high) followed by 1218 (July 13 high).

Oil - 82.20

Initial support at 80.0 (Intraday Support) followed by 79.00 (Intraday Support). Initial resistance is now at 82.50 (Intraday Resistance) followed by 85.00 (Intraday Resistance).