U.S. Dollar Trading (US) a better than expected Aug ISM manufacturing Survey at 50.6 above the expansionary 50 level sent stocks to day highs at the start of the US session. The stocks then started to pull back and finished quite negative going into the US jobs data which is a major risk event. In US stocks on Friday, DJIA -119 points closing at 11493, S&P -14 points closing at 1204 and NASDAQ -33 points closing at 2546. Looking ahead, August Non Payrolls forecast at 75 vs. 117k previously. August Employment rate forecast at 9.1%.
The Euro (EUR) the euro searched for support under 1.4300. The market then consolidated into the close ahead of today's US data. A poor Spanish Bond auction kept the sentiment poor. August Manufacturing PMI slipped to 49.0 vs. 49.7 previously. German Q2 GDP remained at 0.1%. Looking ahead, July PPI forecast 0.5% vs. 0.0% previously.
The Japanese Yen (JPY) tested resistance above Y77 a few times on strong US data but fell back under the level into the US close as stock losses accelerated. EUR/JPY and GBP/JPY were very heavy as their down trend continued for a third day. USD/JPY is always a major mover on US jobs data and tonight should prove no different.
The Sterling (GBP) fell sharply in the US session down under 1.6200 and finding support in the lower 1.6100 area before grinding higher into the close. EUR/GBP fell back towards 0.8800 on Euro weakness and could support the GBP/USD if the selling continues. Looking ahead, August Services PMI forecast at 52.6 vs. 53.6 previously.
The Australian Dollar (AUD) the Aussie outperformed the rest of the market with strong economic data and good Chinese PMI data providing plenty of support even as stock markets fell. Resistance at 1.0720 broke in the European session before running out of steam and consolidating above the figure.
Oil & Gold (XAU) Gold stayed in the previous day range falling to $1812 before finished unchanged at $1826. Crude tested above $89 on news that two new storms threatened production in the Gulf.
Pairs to watch
USD/JPY will tonight's US jobs data break the major out of its Y76.50-Y77 range?
OIL/USD are the storms developing into hurricanes?
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.4260
Initial support at 1.4244 (61.8% retrace of 1.4055-1.4549) followed by 1.4150 (Aug 12 low). Initial resistance is now located at 1.4469 (Aug 31 high) followed by 1.4549 (Aug 29 high)
Yen - 76.90
Initial support is located at 76.34 (Aug 22 low) followed by 75.95 (Psych level). Initial resistance is now at 77.02 (Aug 29 high) followed by 78.86 (Aug 8 high).
Pound - 1.6185
Initial support at 1.6167 (Aug 12 low) followed by 1.6111 (Aug 11 low). Initial resistance is now at 1.6334 (Aug 31 high) followed by 1.6420 (Aug 30 high).
Australian Dollar - 1.0695
Initial support at 1.0621 (Aug 30 low) followed by the 1.0561 (Aug 29 low). Initial resistance is now at 1.0786 (Aug 3 high) followed by 1.1007 (Aug High).
Gold - 1829
Initial support at 1783 (Aug 30 low) followed by 1757 (Aug 26 low). Initial resistance is now at 1853 (Aug 24 high) followed by 1913 (Aug 23 high).
Oil - 88.65
Initial support at 88.00 (Intraday Support) followed by 87.00 (Intraday Support). Initial resistance is now at 90.00 (Intraday resistance) followed by 92.50 (Intraday Resistance).
Written by Anthony Darvall