Forex - ECB President Trichet’s comments push Euro up; All eyes on Non-Farm Payrolls
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Forex News and Events:
Although the ECB kept rates on hold as expected, Trichet did put on a hawkish tone indicating the possibility of a rate hike next month. He went further by saying economic fundamentals look strong however risks to price stability remain ever present. The EURUSD gained 250 points, trading from 1.5368 yesterday to 1.5618 early this morning. The Bank of England also kept rates on hold as expected but did not release any comments. There was no effect to the GBPUSD at the time of the announcement, however the pair eventually gained some ground on the back of the Euro’s strength later in the day.
Today’s employment figures are expected to drop for another month in a row, indicating that the United States may be in a mild recession. The dollar’s upside remains attractive as yesterday’s jobless claims were better than expected. The forecast for the payrolls today is a decline of 75k versus a decline of 58k previous.
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Today's Key Issues (time in GMT):
10:00 EUR German Industrial Production s.a. (MoM) (APR) 0.2% vs -0.5%
10:00 EUR German Industrial Production n.s.a. and w.d.a. (YoY) (APR) 6.3% vs 4.7%
11:00 CAD Unemployment Rate (MAY) 6.1% vs 6.1%
11:00 CAD Net Change in Employment (MAY) 8.5K vs 19.2K
12:30 USD Change in Nonfarm Payrolls (MAY) -60K vs -20K
12:30 USD Change in Manufacturing Payrolls (MAY) -40K vs -46K
12:30 USD Unemployment Rate (MAY) 5.1% vs 5.0%
12:30 USD Average Hourly Earnings (MoM) (MAY) 0.2% vs 0.1%
12:30 USD Average Hourly Earnings (YoY) (MAY) 3.4% vs 3.4%
12:30 USD Average Weekly Hours (MAY) 33.7 vs 33.7
12:45 USD Fed's Kroszner Speaks on Financial Markets at Boston College
14:00 USD Wholesale Inventories (APR) 0.5% vs -0.1%
15:15 USD Fed's Malphrus, Chicago Fed's Evans to Speak at Conference
17:30 USD St. Louis Fed's Bullard to Speak on Housing in Wisconsin
19:00 USD Consumer Credit (APR) $7.3B vs $15.3B
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The Risk Today:
EurUsd bounced off the 1.5390 level with a vengeance. The rebound will remain just that below 1.5818. Strong support holds at 1.5390.
GbpUsd continuing its medium-term downtrend and targeting 1.9364. A break above 1.9974 would threaten the bearish bias.
UsdJpy came very close to our second target of 106.50. This level remains a fair resistance. On the downside, 104.50 is the key level.
UsdChf The target is 1.0610. Strong support holds all the way down to 1.0216
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Resistance and Support:
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EURUSD |
GBPUSD |
USDJPY |
USDCHF |
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1.5921 K |
2.0399 S |
111.92 K |
1.1191 K |
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1.5819 M |
2.0101 T |
110.10 T |
1.0625 T |
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1.5628 S |
1.9849 S |
106.51 M |
1.0582 M |
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1.5588 |
1.9547 |
106.06 |
1.0397 |
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1.5388 S |
1.9500 M |
102.60 M |
1.0200 M |
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1.5287 S |
1.9364 K |
100.00 P |
0.9850 S |
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1.5200 S |
1.9188 S |
95.74 K |
0.9637 S |
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S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot |
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