Markets are quite steady today with the Japanese yen slightly softer on rallies in Asian stocks. Gold made another high at 1216 but this time, the greenback doesn't follow lower so far and indeed recovers mildly into early European session. Main focus will turn to job data from US today, including the ADP employment report which serves as a preview to Non-Farm Payroll on Friday.
The ADP employment report is expected to show further improvements in the job market with contraction in the private market eased further fro -203k in October to -148k in November. This will be inline with markets expectations of the drastic improvement in NFP from -190k in October to -114k in November. The Challenger job cuts report will also be featured. Other data to be released today include UK PMI construction, Eurozone PPI and Fed Beige Book.
Looking at the dollar index, some support is seen ahead of 74.19 low and the index recovers mildly today. But after all, risk remains on the downside with 75.08 minor resistance intact and another low below 74.19 is still possible. But after all, we'd expect further loss of downside momentum in next fall that could finally bring a strong, noticeable rebound.
EUR/USD Daily Outlook
Daily Pivots: (S1) 1.4995; (P) 1.5056; (R1) 1.5141; More
EUR/USD retreats mildly ahead of 1.5143 resistance but still, intraday bias will remains on the upside as long as 1.4971 minor support holds. Rise from 1.4828 is still in favor to extend to 1.5143 resistance. Break there will indicate that medium term rally is still in progress for 123.6% projection of 1.2329 to 1.4719 from 1.2456 at 1.5410. On the downside, below 1.4971 will turn intraday bias neutral again. Break of 1.4828 support will reaffirm the case that EUR/USD has topped out and will bring deeper decline towards 1.4626 support next. .
In the bigger picture, while the fall from 1.5143 is sharp, there is no clear confirmation of medium term reversal yet. However, note that upside momentum is clearly diminishing with bearish divergence condition in daily MACD. Hence, even in case of another rise, we'd expect strong resistance at 123.6% projection of 1.2329 to 1.4719 from 1.2456 at 1.5410 to conclude the medium term rise from 1.2456 eventually. ON the downside, break of 1.4626 support will now be an important indicate that EUR/USD has topped out and deeper decline should then be seen to 1.3747 support for confirmation.
Economic Indicators Update
|23:50||JPY||Monetary Base Y/Y Nov||3.80%||4.70%||4.40%|
|9:30||GBP||PMI Construction Nov||46.9||46.2|
|10:00||EUR||Eurozone PPI Y/Y Oct||-6.80%||-7.70%|
|10:00||EUR||Eurozone PPI M/M Oct||0.00%||-0.40%|
|12:30||USD||Challenger Job Cuts Y/Y Nov||--||-50.70%|
|13:15||USD||ADP Employment Change Nov||-148K||-203K|
|15:30||USD||Crude Oil Inventories||-0.4M||1.0M|
|19:00||USD||Fed Beige Book||--||--|