Forex - Payrolls expected to decline for the fourth straight month

Forex News and Events: The dollar held firm ground overnight trading between 1.5446 and 1.5482. Yesterday’s data came out slightly better than expectations: ISM manufacturing index was flat at 48.6, better than a decline. Weekly jobless claims rose more than expected, to 380,000 versus a consensus of 365,000. Core PCE prices rose 0.2%m/m, pointing to a possible aggressive Fed stance against inflation in the medium-term. The Non-Farm Payrolls announcement is the highlight of the day. The market is anticipating a 100,000 drop and a 0.2% rise in unemployment to 5.3%. Australian retail sales came out better than expected at 0.5%m/m versus a consensus of 0.3%m/m. The RBA is closely monitoring real demand and consumption, and with commodity prices retreating, the AUDUSD pair may face large downside pressure.

Today's Key Issues (time in GMT): 09:00 EUR PMI Manufacturing APR F 50.8 vs 50.8 09:30 GBP PMI Construction APR 47 vs 47.2 13:30 USD Change in Nonfarm Payrolls APR -78k vs -80k 13:30 USD Unemployment Rate APR 5.20% vs 5.10% 13:30 USD Change in Manufact. Payrolls APR -35K vs -48K 13:30 USD Average Hourly Earnings MoM APR 0.30% vs 0.30% 13:30 USD Average Hourly Earnings YoY APR 3.60% vs 3.60% 13:30 USD Average Weekly Hours APR 33.7 vs 33.8 14:00 USD RPX Composite 28dy Index Feb-29 14:00 USD RPX Composite 28dy YoY FEB 15:00 USD Factory Orders MAR 0.20% vs -1.30%

The Risk Today: EurUsd targeting major support level of 1.5342. A daily/weekly close below this level opens the door straight down to 1.5000. The pair is also at the bottom of the sideways channel, with risk of a rebound to 1.6038 still imminent. GbpUsd showing heavy consolidation between 1.9600 and 2.0000. The market does not show any strong signs of power to pass 2.0000, therefore we target a triple bottom at 1.9346. UsdJpy hits the Winnipeg line at 105.00. The pair could have a major move to the downside as a result, however, on the upside, 108.67 is the next target. UsdChf is looking to close above 1.0478 to confirm a solid retracement and move back up is in the works. Current support holds at 1.0262.

Resistance and Support: EURUSD GBPUSD USDJPY USDCHF 1.6200 T 2.0577 T 111.92 K 1.1191 S 1.6019 M 2.0447 S 110.10 T 1.0500 S 1.6000 K 2.0100 P 105.00 S 1.0457 T 1.5473 1.9842 104.68 1.0480 1.5400 S 1.9650 S 102.95 M 1.0200 S 1.5246 S 1.9337 S 100.00 P 0.9637 K 1.5000 K 1.9105 K 95.74 S 0.9500 T S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot