U.S. Dollar Edges Up Ahead of Jobs Report

The U.S. Dollar is trading slightly better against mostmajor currencies ahead of this morning’s Non-Farm Payrolls Report. The smallrally is most likely short-covering after a sharp break on Thursday.

The U.S. Dollar is trading slightly better against mostmajor currencies ahead of this morning’s Non-Farm Payrolls Report. The smallrally is most likely short-covering after a sharp break on Thursday.

Pre-report estimates call for a 70,000 increase in Non-FarmPayrolls in October. This will be the first gain since May. The unemploymentrate is forecast to move higher from 9.6% to 9.7%. What this report is expectedto say is that the economy is acting as if it’s stuck in mud. The economy needsto be creating at least 250,000 jobs or more.

Even though the Fed pledged $900 billion in quantitativeeasing earlier in the week, this doesn’t mean that employers will start hiring.Employers are waiting for consumers to step up their game before they willstart bringing in new workers.

If the jobs data misses the guess this morning, then lookfor continued weakness in the Dollar. A better-than-expected report will likelylead to profit-taking and position paring in the Euro and British Pound. Abreak in equities and commodities will pressure the Australian, New Zealand andCanadian Dollars.

Technical signs are building in the USD JPY which indicateimpending volatility. If the jobs number disappoints then look for the Dollar/Yento plunge to a new low for the year through the 80.00 support level.Speculators will then set their sites on the April 1995 low at 79.70.

Overnight the Japanese Yen had very little reaction to theBank of Japan’s decision to hold interest rates unchanged and the release ofdetails of its recent liquidity-injection campaign.

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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