U.S. Dollar Mixed as Jobs Data Offers No Insight into Fed’s Next Move

The U.S. Dollar is trading mixed at themid-session after the Non-Farm Payrolls Report failed to offer any insight intohow much the Fed is likely to contribute to its balance sheet in the form ofquantitative easing.

The U.S. Dollar is trading mixed at themid-session after the Non-Farm Payrolls Report failed to offer any insight intohow much the Fed is likely to contribute to its balance sheet in the form ofquantitative easing.

The September jobs report headline numberwas worse than expected, but the private sector added jobs. The government shedmore jobs than were added, but this was expected. Traders seem to have decidedthat the report was pretty close to pre-report estimates and shifted theirfocus on the size of the Fed’s asset buyback program.

What is being debated by traders is whetherthe Fed will use the “shock and awe” approach and flood the market with a hugeamount of liquidity early or will it distribute the QE over time.

At the mid-session, the Dollar is tradinglower against the Japanese Yen, Canadian Dollar, Australian Dollar, New ZealandDollar and British Pound. From the looks of it, the commodity-linked currenciesare still strong. The British Pound is up because the Bank of England refrainedfrom additional quantitative easing earlier this week. The weakening U.S.economy is making the Japanese economy look better.

The Euro has been looking a little toppysince Thursday after European Central Bank President Trichet failed to makeclear whether the ECB is planning an exit strategy from its emergency measures.Short-term overbought technical factors are also contributing to today’sweakness.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More

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