EUR/USD Hits 14-Month High Following Non-Farms Report.
The US dollar fell to a fresh 14-month low against the euro on Friday, following a disappointing Non-Farm Payrolls figure which reaffirmed speculations that the Fed will leave in place record low interest rates for the foreseeable future. This week, news out of the euro-zone is forecasted to have the biggest impact on the marketplace. Traders will want to pay attention to today's Spanish Unemployment Change, the German Factory Orders figure on Wednesday, and Thursday's Minimum Bid Rate and ECB Press Conference. Any disappointing data may cause the euro to reverse its recent bullish trend.
While a worse than expected US Non-Farm Payrolls report resulted in the US dollar turning bearish during mid-day trading on Friday, the greenback was able to rebound later in the day following a positive ISM Manufacturing PMI. The USD/CHF, which traded as low as 0.9021 during the first half of the day, gained more than 60 pips during the afternoon session to eventually close out the week at 0.9076. The USD/JPY was able to gain more than 100 pips during US trading, eventually reaching as high as 92.95, before dropping back to 92.77.
This week, dollar traders will want to pay attention to a number of potentially significant US economic indicators. Tuesday's ISM Non-Manufacturing PMI, Thursday's Unemployment Claims figure, and Friday's Trade Balance can all give the dollar an additional boost if they show any kind of improvements in the US economy. Conversely, if the US news signals that the US economic recovery is slowing down, the dollar could take losses against its main currency rivals.
The euro saw gains against both the safe-haven US dollar and Japanese yen on Friday, following a worse than expected Non-Farm Payrolls figure which reaffirmed speculations that the Fed will leave in place record US low interest rates for the foreseeable future. The EUR/USD advanced more than 100 pips during the mid-day session to trade as high as 1.3710, a new 14-month high. A downward correction later in the day resulted in the pair closing out the week at 1.3642. The EUR/JPY gained close to 200 pips toward the end of the European session before peaking at 126.96
Euro traders will want to pay attention to several economic indicators over the course of this week. Perhaps the most significant piece of news will be Thursday's Minimum Bid Rate and ECB Press Conference. While the European Central Bank is not expected to adjust interest rates, any indication that the situation in the euro-zone is improving may help the euro extend some of its recent gains. Additionally, today's Spanish Unemployment Change and Wednesday's German Factory Orders figures could give the euro a short-term boost if they come in above their forecasted levels.
Gold prices spiked more than $15 an ounce to trade as high as $1681.86 on Friday, following a worse than expected US Non-Farm Payrolls report. That being said, the gains were only temporary, and by the afternoon session the precious metal had dropped back to $1670 and eventually finished out the week at $1666.93.
This week, gold traders will want to pay attention to the US ISM Non-Manufacturing PMI and Trade Balance figures. If either of the indicators comes in below their forecasted levels, the dollar could turn bearish, which would likely lead to an increase in gold prices.
The weekly chart's Slow Stochastic is close to forming a bearish cross, indicating that a downward correction could occur in the near future. Additionally, the same chart's Relative Strength Index has crossed into overbought territory. Opening long positions may be the smart choice for this pair.
The Williams Percent Range on the weekly chart has fallen into oversold territory, indicating that an upward correction could occur in the near future. Furthermore, the MACD/OsMA on the daily chart appears close to forming a bullish cross. Traders may want to open long positions.
The Relative Strength Index on the weekly chart has cross into overbought territory, indicating that a downward correction could occur in the coming days. This theory is supported by the Slow Stochastic on the same chart, which has formed a bearish cross. Opening short positions may be the smart choice for this pair.
While the weekly chart's Williams Percent Range has crossed over into oversold territory, most other long-term technical indicators place this pair in neutral territory. Traders may want to take a wait and see approach, as a clearer picture is likely to present itself in the near future.
The Williams Percent Range on the daily chart has crossed over into overbought territory, indicating that a downward correction could occur in the near future. This theory is supported by the Slow Stochastic on the same chart, which has formed a bearish cross. Opening short positions may be the best choice for forex traders today.
|ANZ Commodity Prices|
The Australia and New Zealand Banking Group Limited (ANZ)Commodity Prices Indicator, also called the Commoditiy Price Index, measures the change in the price of exported commodities. Since Australia and New Zealand depend heavily upon commodity exports, this figure acts as a primary gauge of the two nations' GDP and economic strength.
This report is a measure of impending construction activity. It is a significant indicator since the first step in beginning a new construction project is the acquisition of permits granting the approval to do so.
|ANZ Job Advertisements|
This report is measuring the change in the number of jobs advertised in the major daily newspapers and websites covering the capital cities in Australia and New Zealand.
|Spanish Unemployment Change|
Change in the number of people unemployed and actively seeking employment during the previous month
|Sentix Investor Confidence|
This is a report which measures investors' confidence towards the Euro-zone economy. A rising trend tends to have a positive effect on the EUR, as it suggests that funds are more likely to invest in European securities.
The Construction Purchasing Manager's Index (PMI) measures the level of activity among purchasing managers in the construction sector of the economy. Above 50 signals industry expansion; below 50 indicates a contraction. Construction figures are an important indicator of housing demand.
The Producer Price Index (PPI) is a measure of the inflation rate incurred by manufacturers when purchasing goods and services.
This indicator presents a measure of the value of new orders placed with domestic manufacturers for durable and non-durable goods. It typically has a small impact as the Durable Goods Orders indicator report already signified the primary results on this sector of the economy.
|Labor Cost Index|
Measures annualized rate of inflation in the wages, salaries and benefits paid to civilian workers. A rising trend has a positive effect on the nation's currency. When businesses pay more for labor, they are likely to pass the higher costs to the consumer, so traders view wage inflation as a leading indicator of consumer inflation.
|AIG Services Index|
This indicator measures business conditions in a number of service sector companies. A number above 50.0 indicates industry expansion; below 50.0 signals a contraction. Survey is conducted by Australian Industry Group (AIG).