Non-Farm Payrolls To Determine Direction

Non-Farm Payrolls To Determine Direction

8 January 2016, 11:57
maimarfx
0
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Dear Traders,

The euro continued its relief rally against the U.S. dollar and tested the resistance zone between 1.0925 and 1.0950. As long as there is no significant break above 1.10 and further 1.1050, the latest downtrend is considered intact. The British pound however, weakened against the greenback and marked a fresh support at around 1.4530. Traders should bear in mind that there is no important support until 1.4350 which is why the risk is to the downside.

Once again, all eyes will be on today's U.S. Payrolls Report, scheduled for release at 13:30 GMT. The report is of major importance as in the face of a global currency war and the effects of slowing Chinese growth and a stronger dollar, the U.S. jobs report will help prove the economic stability. Payrolls growth is forecast to show near 200K jobs but given the recent turmoil in financial markets only an unambiguous strong report, by far exceeding 200,000, would brighten the prospects. The focus is also on wage growth. Average Hourly Earnings are projected to climb 2.8 percent and if this it true, we could see USD extending its gains versus the euro and pound sterling.

Here is where we see important price levels:

EUR/USD

Current resistances: 1.0945, 1.0990, 1.1045/50. Above 1.1055 chances are that the euro is headed for 1.11 and 1.1170.

Current supports: 1.0830, 1.0770, 1.07/1.0685. In case the euro falls below 1.0685, it may tests the 1.0630 and 1.0550-barrier.

GBP/USD

Today's price action will depend on NFP data. In case of a lackluster report, GBP could gain ground and heads towards the resistance area at 1.4790-1.4850. In the opposite case, a break below 1.4530 could drive sterling south towards 1.4480 and 1.44.

GBP/USD 

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