The US dollar/Japanese Yen might continue incurring losses after the Non-Farm employees report because the two appear to be edging towards a Bull-Flag state.
US dollar/Canadian dollar might continue to go towards the December low of 1.3080 because it continues on the recent trend of smaller highs and lows after the 53.7K rise in Canada’s employment, which follows a 81.3K pickup in employment positions that are full-time; the pickup in the PMI brings out a better outlook for the country as it rises to 60.8 in December to position at 2nd in the highest reading for 2016.
The surge of positive outlooks is likely to give hope to the Bank of Canada to continue with the current policy in the January meeting on the 18th. However, Governor Poloz and Company might continue with changing their views and display better willingness to slowly go away from the easing cycle as the country’s economic state is predicted to expand.
Bigger development for US dollar/Canadian dollar continues to be positive as it continually operates in the upward trend carried over from 2016. However, a break below 1.3160 shows the risk of the December low being tested which stays in line with the 200 days SMA (1.31).
US dollar/Japanese Yen moved the decline at the beginning of the week even when the NFP report brought out a 156k growth in December. Mean hourly salaries rose by 2.9% to become the fastest growth rate since 2009 and signs of greater household salaries might put the F.O.M.C in line to continue to normalize the money policy this year, as a lot of partakers judged that the risk of a meaningful undershooting in the long run, in regards to the usual unemployment level, had gone up somehow and the F.O.M.C may have to increase the federal funds level quicker than it is currently expected, in order to put a limit on the level of undershooting and stop potential pile up of inflation pressures.
EUR/US dollar opposes prior Bear Flag formation and the post Non-Farm employees’ payroll
Earlier today, Jan 6th 2017, the NFP report was given out in the US with a small omission on the number of the headline, showing an addition of 156,000 plus jobs to the US payrolls against the expected 180,000. However, in the report there was a little bit of positive information that helps to preclude the omission in the headline print.
The first response in the Greenback was a strong one because the US Dollar rose to a region of opposition before support at 101.80. This is a 61.8% Fibonacci backward move, a change that was clearly noted by CMC Markets.
As expected, traders must practice prudence if they’re looking for a news-driven change on a Friday. This change in the Dollar, especially, must be treated with a big deal of warning because the short run price action is arising from a recent lower low and till the prior lower high is removed, questions will continue to be raised.
EUR/US dollar opposition below Prior Bear Flag formation
The recent occurrence of the support close in the Dollar has assisted in strengthening the EUR/US dollar. The two finally closed under the Bear flag formation, that is 1 and 1/2 years old, in December with the one to two combination of the ECB and Federal reserve. However, the fall in prices action seemed to go gradually as prices went way below formation.
The gold costs might continue on an upward trend following the data on US jobs
The prices of gold went on an upward trend continually for the 3rd day as the relaxing of the “Trump trade” continued following the day’s release of US employee payrolls. The Dollar continued to gain from a high of 14 years and the Treasury Bond’s earnings went down at the same time, giving support to assets that do not bear interest and are anti-fiat.
The crude oil prices went down at first together with the prices of the US shares, borrowing prices and the Greenback, showing a pattern witnessed at the beginning of the week that shows consistency with profit being gained on main themes of the ending weeks of last year.