EUR/USD Technical Analysis for February 3, 2012
EUR/USD fell during the Thursday session in a tight range. The candle is a hammer, and it looks like the market wants to rise as a result of the Non-Farm Payroll numbers later today. The pair sees a lot of resistance at the 1.32 level, which of course is the 38.2% Fibonacci level from the larger move down. However, we need to see this pair either break and close above the level, or break and close below the 1.29 level in order to get some kind of clarity.
The Non-Farm Payroll report typically moves this pair, but the world clearly is more concerned with Europe in general, so it will take something pretty special in this report to move the markets for any significant move. Because of this – we are flat in this pair as it will more than likely bounce around to chop up accounts after the announcement.
EUR/USD Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
EUR/USD Fundamental Analysis February 3, 2012, Forecast
Analysis and Recommendations:
The EUR/USD at 1.3166 winding down its day almost at the close.
European officials dashed hopes of a fast settlement between Greece and its private bondholders due to the opposition of some of the Greek political leaders towards additional spending cuts demanded by the lenders as well as a disagreement between the IMF and Germany on the involvement of the ECB in the bond swap.
Spain’s Treasury auctioned EUR4.5 billion of medium term debt earlier, at much lower yields than previously.Investors purchased EUR2.52 billion of three-year bonds at a yield of 2.8%, down from 3.38% in January and EUR1.05 billion of five-year bonds at a yield of 3.5%, compared to 5.5% last month.
France auctioned EUR8 billion of government debt in an auction which met with solid investor demand and lower yields.
The Challenger Jobs report figures showed job losses in January totaled 53,486 in January, the highest total since last September and nearly 39% higher than job cuts of 38,519 in January 2011. Compared with December 2011 job cuts of 41,785, the January losses are 28% higher.
Government job losses totaled just 3,021, but the monthly average for 2011 was 15,255 job cuts. In the past 24 months, 325,319 jobs have been lost in the public sector
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 28 fell by 12,000 to a seasonally adjusted 367,000, beating expectations for a decline to 373,000. The previous week’s figure was revised up to 379,000 from 377,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 12 of the past 14 weeks.
Europe’s financial crisis still threatens the U.S. recovery, and the Federal Reserve will do everything it can to prevent it from damaging the economy, Federal Reserve Chairman Ben Bernanke said on Thursday. “Risks remain that developments in Europe or elsewhere may unfold unfavorably and could worsen economic prospects here at home,” Bernanke told lawmakers in prepared remarks.
“We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy.”
Bernanke maintained a cautious tone on the U.S. outlook following a decision at a Fed policy meeting last week to announce that interest rates are likely to remain near zero until at least through late 2014.
At a news conference after that meeting, Bernanke indicated the central bank was considering additional monetary easing, but he offered no fresh hints of such plans in his testimony.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
USD/JPY Technical Analysis for February 3, 2012
USD/JPY fell again on Thursday as traders prepare for the Non-Farm Payroll number today. The market almost always will react in violent moves to this announcement, and this pair is no different. The levels we are approaching though – they suggest only one way to trade.
The pair is to be bought only, as the Bank of Japan is sitting just below where we are at the moment, and intervention is certainly something they aren’t afraid of doing. The strong Yen has been making it tough on the Japanese economy for some time now, and with the rest of the world showing signs of slowing down, those Japanese products that the country depends on exporting certainly cannot be overly expensive. With this in mind, the central bank and major exporters are all trying to fight Yen strength.
The recent action has been a sudden drop, followed by several supportive hammers in a row. This suggests that either we are approaching strong order sizes, or the market is leery of the area we are in. (They should be.) The central bank is also starting to talk about intervention as well, and this normally starts just about a week or two before action.
The Non-Farm Payroll number will move the market, but we certainly cannot sell now. The pair could be bought on a dip, and any negative knee-jerk reaction is almost an invitation to go long and watch the Bank of Japan intervene. It should be noted though, that the BoJ typically does these interventions on Monday morning in Asia, when the markets are very quiet. If there is a bad reaction to the NFP today, the central bank may not get involved until then.
We would also be interested in buying if the market can break above the 76.50 level again, and prove it as supportive. However, this probably wouldn’t be accomplished in a single session, so this buy trigger wouldn’t be obvious until sometime next week. The pair could pop back up to the 78 area, and this is our target as soon as we get some kind of buy signal – or sell off to fade.
USD/JPY Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
USD/CHF Fundamental Analysis February 3 , 2012, Forecast Analysis and Recommendations:
The USD/CHF trading at 0.9171 up from the opening.
The USD gathered strenght through out the day on positive economic data and reports regarding Greece. At this writing it is the most confusing news, which can not be interpreted. Juncker says one thing, Rehn says something different and new reports are completely different. The latest news is stating that European officials this evening dashed hopes of a fast settlement between Greece and its private bondholders due to the opposition of some of the Greek political leaders towards additional spending cuts demanded by the lenders as well as a disagreement between the IMF and Germany on the involvement of the ECB in the bond swap. Friday will be all about he said, she said.. deal or no deal.
The Challenger Jobs report figures showed job losses in January totaled 53,486 in January, the highest total since last September and nearly 39% higher than job cuts of 38,519 in January 2011. Compared with December 2011 job cuts of 41,785, the January losses are 28% higher.
Government job losses totaled just 3,021, but the monthly average for 2011 was 15,255 job cuts. In the past 24 months, 325,319 jobs have been lost in the public sector.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 28 fell by 12,000 to a seasonally adjusted 367,000, beating expectations for a decline to 373,000. The previous week’s figure was revised up to 379,000 from 377,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 12 of the past 14 weeks.
Europe’s financial crisis still threatens the U.S. recovery, and the Federal Reserve will do everything it can to prevent it from damaging the economy, Federal Reserve Chairman Ben Bernanke said on Thursday. “Risks remain that developments in Europe or elsewhere may unfold unfavorably and could worsen economic prospects here at home,” Bernanke told lawmakers in prepared remarks.
“We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy.”
Bernanke maintained a cautious tone on the U.S. outlook following a decision at a Fed policy meeting last week to announce that interest rates are likely to remain near zero until at least through late 2014.
At a news conference after that meeting, Bernanke indicated the central bank was considering additional monetary easing, but he offered no fresh hints of such plans in his testimony.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
GBP/USD Technical Analysis for February 3, 2012
GBP/USD pulled back to the 1.58 level on Thursday, showing that the area is indeed important. The breaking above this level showed significant strength, and as a reminder, it offered support at the end of the session yesterday.
The area should show support down to the 1.57 level, and for good measure many traders will wait until the hammer from the Monday session is shattered as well. This is going to take real strength by the sellers, and would show just how suddenly things have changed if it were to happen.
The cable pair can often react significantly to the Non-Farm Payroll report, and as it comes out later today – this could be an interesting session. If we get a strong number, this will often have Americans selling the Dollar, and reaching for other currencies such as the Pound. The pair is certainly driven by a certain amount of risk appetite, and as a result – the better the jobs number, the more traders are willing to bet on riskier assets.
The pair could very well react suddenly to the number, but the reality is that unless the Non-Farm Payroll is an absolute blowout in either direction, the move will probably reverse in the course of the next few hours. The recent history of the NFP announcements seems to suggest this is rapidly becoming the norm. In fact, employment isn’t what the market is focusing on. (We all know it isn’t good.)
The Pound is overbought; there is no doubt about it. A daily close below that hammer would be the safest of all shorts at this point, but there is little chance of that happening on Friday alone. If it does – this would be bad news. More likely, we could see a sell signal in the form of a spike higher, and a failure at the 1.59 – 1.60 area. If this happens, there could be a short-term trade in shorting that unsustainable spike. Otherwise, this pair is simply sitting between two are that are far too close to trade around as the resistance starts at 1.59, and the support starts at 1.58 or so.
GBP/USD Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
GBP/USD Fundamental Analysis February 3 , 2012, Forecast Analysis and Recommendations:
The GBP/USD is currently down to 1.5802
The Sterling fell against the dollar today, after comments from Bank of England member Adam Posner. Posner indicated that there could be a circumstance where the BoE institute a stimulus package of 75billion pounds as the UK economy is facing difficulty. Mr. Posner did not elaborate.
Overall today, there was more positive news from the US front then negative. The most encouraging with the unexpected drop in unemployment claims. Combined with Fed Chairman Bernanke’s comments the USD maintained its strength against its trading partners.
The Challenger Jobs report figures showed job losses in January totaled 53,486 in January, the highest total since last September and nearly 39% higher than job cuts of 38,519 in January 2011. Compared with December 2011 job cuts of 41,785, the January losses are 28% higher.
Government job losses totaled just 3,021, but the monthly average for 2011 was 15,255 job cuts. In the past 24 months, 325,319 jobs have been lost in the public sector.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 28 fell by 12,000 to a seasonally adjusted 367,000, beating expectations for a decline to 373,000. The previous week’s figure was revised up to 379,000 from 377,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 12 of the past 14 weeks.
Europe’s financial crisis still threatens the U.S. recovery, and the Federal Reserve will do everything it can to prevent it from damaging the economy, Federal Reserve Chairman Ben Bernanke said on Thursday. “Risks remain that developments in Europe or elsewhere may unfold unfavorably and could worsen economic prospects here at home,” Bernanke told lawmakers in prepared remarks.
“We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy.”
Bernanke maintained a cautious tone on the U.S. outlook following a decision at a Fed policy meeting last week to announce that interest rates are likely to remain near zero until at least through late 2014.
At a news conference after that meeting, Bernanke indicated the central bank was considering additional monetary easing, but he offered no fresh hints of such plans in his testimony.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
EUR/GBP Technical Analysis for February 3, 2012
EUR/GBP fell during most of the session on Thursday, but found a bounce in the late hours to form a hammer. The pair has been running into support at the 0.8280 level, and it looks as if the area will become a good point in which to sell if we get a close below it. So far, we haven’t, but with the trend being so decidedly bearish, it seems it will only be a matter of time.
The 0.84 level above is resistive, and so is the 0.85 level above that. Because of this, we are only selling at this point, and aren’t considering buying. The Euro has far too many troubles for us to want to own it, even if the Pound has a lot of bad news surrounding it either. (Although you would never know it by the way it is acting lately.) We are looking for weakness at 0.84 to sell, and rallies that fade as well. A daily close below 0.8280 has us selling too.
EUR/GBP Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
EUR/GBP Fundamental Analysis February 3 , 2012, Forecast Analysis and Recommendations:
The pair EUR/GBP is currently 0.8317. The euro pushed higher against the pound, with pair climbing 0.07%.
The Sterling fell lost against the euro, after comments from Bank of England member Adam Posner. Posner indicated that there could be a circumstance where the BoE institute a stimulus package of 75billion pounds as the UK economy is facing difficulty. Mr. Posner did not elaborate.
At this writing it is the most confusing news, which can not be interpreted. Juncker says one thing, Rehn says something different and new reports are completely different. The latest news is stating that European officials this evening dashed hopes of a fast settlement between Greece and its private bondholders due to the opposition of some of the Greek political leaders towards additional spending cuts demanded by the lenders as well as a disagreement between the IMF and Germany on the involvement of the ECB in the bond swap. Friday will be all about he said, she said.. deal or no deal.
Spain’s Treasury auctioned EUR4.5 billion of medium term debt earlier, at much lower yields than previously.Investors purchased EUR2.52 billion of three-year bonds at a yield of 2.8%, down from 3.38% in January and EUR1.05 billion of five-year bonds at a yield of 3.5%, compared to 5.5% last month.
France auctioned EUR8 billion of government debt in an auction which met with solid investor demand and lower yields.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
USD/CHF Technical Analysis for February 3, 2012
USD/CHF rose during the session on Thursday, but was fairly weak in its momentum. It gave up about half of the gains by the close, and the pair looks like it isn’t quite ready to move forward yet. We have a simple set up in the pair at the moment, as the support level just below should be strong going down to the 0.90 level. The market simply must close below that level for us to consider selling, but even then we will more than likely pass as the Swiss National Bank is working against the value of the Franc.
A move above the Wednesday high would be our cue to buy. The Franc should continue to weaken over time, and any intervention in the EUR/CHF pair will translate over to this market as well. Because of this, we much prefer buying this pair than selling it.
USD/CHF Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
USD/CHF Fundamental Analysis February 3 , 2012, Forecast Analysis and Recommendations:
The USD/CHF trading at 0.9171 up from the opening.
The USD gathered strenght through out the day on positive economic data and reports regarding Greece. At this writing it is the most confusing news, which can not be interpreted. Juncker says one thing, Rehn says something different and new reports are completely different. The latest news is stating that European officials this evening dashed hopes of a fast settlement between Greece and its private bondholders due to the opposition of some of the Greek political leaders towards additional spending cuts demanded by the lenders as well as a disagreement between the IMF and Germany on the involvement of the ECB in the bond swap. Friday will be all about he said, she said.. deal or no deal.
The Challenger Jobs report figures showed job losses in January totaled 53,486 in January, the highest total since last September and nearly 39% higher than job cuts of 38,519 in January 2011. Compared with December 2011 job cuts of 41,785, the January losses are 28% higher.
Government job losses totaled just 3,021, but the monthly average for 2011 was 15,255 job cuts. In the past 24 months, 325,319 jobs have been lost in the public sector.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 28 fell by 12,000 to a seasonally adjusted 367,000, beating expectations for a decline to 373,000. The previous week’s figure was revised up to 379,000 from 377,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 12 of the past 14 weeks.
Europe’s financial crisis still threatens the U.S. recovery, and the Federal Reserve will do everything it can to prevent it from damaging the economy, Federal Reserve Chairman Ben Bernanke said on Thursday. “Risks remain that developments in Europe or elsewhere may unfold unfavorably and could worsen economic prospects here at home,” Bernanke told lawmakers in prepared remarks.
“We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy.”
Bernanke maintained a cautious tone on the U.S. outlook following a decision at a Fed policy meeting last week to announce that interest rates are likely to remain near zero until at least through late 2014.
At a news conference after that meeting, Bernanke indicated the central bank was considering additional monetary easing, but he offered no fresh hints of such plans in his testimony.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
EUR/CHF Technical Analysis for February 3, 2012
EUR/CHF is falling over time, but Thursday saw a little bit of a reprieve. However, the gains were mostly given back. The Swiss National Bank is currently ready to defend the 1.20 level, and most certainly act if the pair falls below it. Because of this, the pair can only be bought if you are to trade it.
The candles sticks actually look quite bearish, but the backstop is a large one considering the market is being held up by a central bank that has said several times it would be willing to buy “unlimited Euros” in order to keep the rate up. A long position can be taken as long as you are patient. One of two things will happen: Either the pair falls below and starts intervention, or the pair grinds higher as traders aren’t interested in testing the central bank. Only fools and reckless traders are shorting now.
EUR/CHF Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
09:30 GBP Services PMI 53.5 54.0
The Services Purchasing Managers’ Index (PMI) measures the activity level of purchasing managers in the services sector. A reading above 50 indicates expansion in the sector; a reading below 50 indicates contraction. Traders watch these surveys closely as purchasing managers usually have early access to data about their company’s performance, which can be a leading indicator of overall economic performance.
A higher than expected reading should be taken as positive/bullish for the GBP, while a lower than expected reading should be taken as negative/bearish for the GBP.
10:00 EUR Retail Sales (MoM) 0.4% -0.8%
Retail Sales measure the change in the total value of inflation-adjusted sales at the retail level. It is the foremost indicator of consumer spending, which accounts for the majority of overall economic activity.
A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
EUR/CHF Fundamental Analysis February 3 , 2012, Forecast Analysis and Recommendations:
EUR/CHF is trading 1.2052 slightly up. The pair are stying in a very tight channel, bordering on the 1.20 level set by the SNB. The movement is simple reaction to the fluctuation of the euro. The CHF fundamentals do not seem to have an effect, as the Swissie did not react of the negative trade balance data today.
At this writing it is the most confusing news, which can not be interpreted. Juncker says one thing, Rehn says something different and new reports are completely different. The latest news is stating that European officials this evening dashed hopes of a fast settlement between Greece and its private bondholders due to the opposition of some of the Greek political leaders towards additional spending cuts demanded by the lenders as well as a disagreement between the IMF and Germany on the involvement of the ECB in the bond swap. Friday will be all about he said, she said.. deal or no deal.
Spain’s Treasury auctioned EUR4.5 billion of medium term debt earlier, at much lower yields than previously.Investors purchased EUR2.52 billion of three-year bonds at a yield of 2.8%, down from 3.38% in January and EUR1.05 billion of five-year bonds at a yield of 3.5%, compared to 5.5% last month.
France auctioned EUR8 billion of government debt in an auction which met with solid investor demand and lower yields.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
AUD/USD Technical Analysis for February 3, 2012
AUD/USD rose initially during the Thursday session, but fell in the later hours to form a shooting star. The shooting star is at the previous highs, so while it isn’t a large one – it does carry some weight. The Non-Farm Payroll report later today will be the catalyst to move this pair going forward in the near-term, and the candle will be treated like a doji by us.
The signals are simple: If the market breaks above the highs of the Thursday range, we will buy. If it breaks below the lows of the Thursday range, we won’t sell; we will look for support in the 1.05 to 1.04 area. Selling isn’t a thought until we get a daily close below the 1.04 level.
AUD/USD Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
No Local Economic Events Scheduled for Friday
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
AUD/USD Fundamental Analysis Feb.3 , 2012 Forecast
Analysis and Recommendation: ( close of Asian session )
AUD/USD was trading at 1.0712. The Aussie on solid economic strenght in Australia and comments by Prime Minister Gillard saying that the Australian dollar will remain relatively strong for years to come, driven by its new found “safe haven” status and as investors use it as a proxy currency for the Asian region.
The Prime Minster stated that the European crisis was of a different nature – one stemming from concern about sovereign risk and the need for eurozone governments to undertake “long-term fiscal repair”.
As the USD lost strength, on economic data yesterday, investors sold greenbacks and looked for other safe haven currencies. The so-called risk currencies like Aussie and kiwi can be very well-supported. The duo hit 1.0756 in Asian trading up 0.27% and up from a session low of 1.0703 and off from a high of 1.0756.
Australia’s trade surplus rose to 1.7 billion Australian dollars ($1.8 billion) in December, from A$1.3 billion in November. Forecasts had projected a trade surplus of A$1.2 billion in the month. Exports rose 2% to A$27.8 billion, while imports rose 1% to A$26.1 billion, the Australian Bureau of Statistics reported Thursday. The ABS also said that seasonally-adjusted housing approvals fell 1% in December, compared to a 10.1% rise in November. Economists had expected a 4% rise in dwelling approvals. ( see below for other economic report data )
Economic Data from Europe and the USA on Wednesday:
GBP Nationwide HPI (MoM) -0.2% -0.1% -0.2% Unexpected Drop
CHF Retail Sales (YoY) 0.6% 1.6% 1.8% Unexpected Drop
CHF SVME PMI 47.3 51.8 49.1 Unexpected Drop
EUR French Manufacturing PMI 48.5 48.5 48.5
EUR German Manufacturing PMI 51.0 50.9 50.9 Above Forecast
EUR Manufacturing PMI 48.8 48.7 48.7 Above Forecast
GBP Manufacturing PMI 52.1 50.1 49.7 Above Forecast
EUR CPI (YoY) 2.7% 2.7% 2.7%
USD ADP Employment Change 170K 189K 292K Unexpected Drop
USD ISM Manufacturing PMI 54.1 54.6 53.9 Above Forecast
USD Crude Oil Inventories 4.2M 3.2M 3.6M Increased Inventory
Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
USD/CAD Technical Analysis for February 3, 2012
USD/CAD had a tight range for the Thursday session as traders await the employment numbers out of both countries today. The two economies are interconnected in major ways, and as a result the pair can be tricky on a Non-Farm Payroll Friday. The better the numbers are for the announcement, the more likely it is that the pair will fall as the US is Canada’s #1 export market by a long shot. Inversely, if their biggest customer isn’t producing jobs, they won’t be buying anything – and therefore the demand for the Loonie will fall. Because of this, the pair can be very tricky on these days. Seeing that there is massive support going down to 0.9750 in this market, the only trade that might work is to buy, and that needs a bad number in order for it to work.
USD/CAD Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
Analysis and Recommendations:
The USD/CAD is currently trading
The Challenger Jobs report figures showed job losses in January totaled 53,486 in January, the highest total since last September and nearly 39% higher than job cuts of 38,519 in January 2011. Compared with December 2011 job cuts of 41,785, the January losses are 28% higher.
Government job losses totaled just 3,021, but the monthly average for 2011 was 15,255 job cuts. In the past 24 months, 325,319 jobs have been lost in the public sector
the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 28 fell by 12,000 to a seasonally adjusted 367,000, beating expectations for a decline to 373,000. The previous week’s figure was revised up to 379,000 from 377,000.
Jobless claims have remained below 400,000, a level historically associated with an improving labor market, in 12 of the past 14 weeks.
Europe’s financial crisis still threatens the U.S. recovery, and the Federal Reserve will do everything it can to prevent it from damaging the economy, Federal Reserve Chairman Ben Bernanke said on Thursday. “Risks remain that developments in Europe or elsewhere may unfold unfavorably and could worsen economic prospects here at home,” Bernanke told lawmakers in prepared remarks.
“We are in frequent contact with European authorities, and we will continue to monitor the situation closely and take every available step to protect the U.S. financial system and the economy.”
Bernanke maintained a cautious tone on the U.S. outlook following a decision at a Fed policy meeting last week to announce that interest rates are likely to remain near zero until at least through late 2014.
At a news conference after that meeting, Bernanke indicated the central bank was considering additional monetary easing, but he offered no fresh hints of such plans in his testimony.
Economic Data Today ( key better than expected worse than expected at forecast )
NZD ANZ Commodity Price Index (MoM) 1.2% -0.8%
AUD Building Approvals (MoM) -1.0% 2.1% 10.1%
AUD Trade Balance 1.71B 1.20B 1.34B
CHF Trade Balance 2.07B 2.85B 2.95B
GBP Construction PMI 51.4 52.9 53.2
EUR PPI (MoM) -0.2% -0.1% 0.2%
USD Challenger Job Cuts (YoY) 38.9% 30.6%
USD Nonfarm Productivity (QoQ) 0.7% 1.0% 1.9%
USD Initial Jobless Claims 367K 373K 379K
USD Unit Labor Costs (QoQ) 1.2% 0.9% -2.1%
USD Continuing Jobless Claims 3437K 3565K 3567K
USD/CAD Fundamental Analysis February 3, 2012, Forecast Scheduled Sovereign Bond Sales
Feb 06 10:10 Norway Bond auction
Feb 07 09:00 Netherlands Eur 5.0bn Jul 2022 DSL
Feb 07 10:10 Greece 6M T-bill auction
Feb 07 10.30 UK Auctions 1.75% 2017 conventional Gilt
Feb 07 15:30 UK Details gilt auction on Feb 16
Feb 07 18:00 US Auctions 3Y Notes
Feb 08 10:10 Sweden Nominal bond auction
Feb 08 10:30 Germany Eur 4.0bn Feb 2017 Bobl
Feb 08 10:30 Swiss Bond auction
Feb 08 16:30 Italy Details BOT auction on Feb 13
Feb 08 18:00 US Auctions 10Y Notes
Feb 09 10:10 Sweden Sek 0.75bn I/L bond auction
Feb 09 15:30 Sweden Details I/L bond auction on Mar 23
Feb 09 16:00 US Announces auctions of 30Y TIPS on Feb 16
Feb 09 16:30 Italy Details BTP/CCTeu auction on Feb 14
Feb 09 18:00 Italy Auctions 30Y Bonds
Feb 10 11:00 Belgium OLO auction
NZD/USD Technical Analysis for February 3, 2012
NZD/USD had a fairly quiet session on Thursday as traders awaited the Friday Non-Farm Payroll number. The daily candle is a small shooting star, and this suggests that the pair is more likely to fall than rise. The breaking down of the range would typically be a sell signal, but the pair has been so strong – it is hard to suggest that. Instead, we are looking at it as a potential pullback – one we will buy into. The 0.8250 level looks to be supportive based upon previous highs and the hammer just below. With this in mind, if the pair falls, we are willing to buy in that area. If it shoots straight up, we will ignore it as the market is far overbought at this point. Selling in this pair isn’t a thought.
NZD/USD Fundamental Analysis for February 3, 2012
Economic Events: (GMT)
No Local Economic Events Scheduled for Friday
00:15 USD FOMC Member Fisher Speaks
Federal Reserve Bank of Dallas President and Federal Open Market Committee (FOMC) voting member (2008 and 2011) Richard Fisher is to speak. FOMC members are responsible for setting the benchmark interest rate and their speeches are closely watched for indications on the future possible direction of monetary policy.
His comments may determine a short-term positive or negative trend
13:30 USD Average Hourly Earnings (MoM) 0.2% 0.2%
13:30 USD Nonfarm Payrolls 150K 200K
13:30 USD Unemployment Rate 8.5% 8.5%
13:30 USD Private Nonfarm Payrolls 170K 212K
Average Hourly Earnings measures the change in the price businesses pay for labor, not including the agricultural sector.
Nonfarm Payrolls measures the change in the number of people employed during the previous month, excluding the farming industry. Job creation is the foremost indicator of consumer spending, which accounts for the majority of economic activity.
The Unemployment Rate measures the percentage of the total work force that is unemployed and actively seeking employment during the previous month.
Private Nonfarm Payrolls measures the change in the number of total number of paid U.S. workers of any business, excluding general government employees, private household employees, employees of nonprofit organizations that provide assistance to individuals and farm employees.
15:00 USD ISM Non-Manufacturing Index 53.2 52.6
The Institute of Supply Management (ISM) Non-Manufacturing Purchasing Managers’ Index (PMI) (also known as the ISM Services PMI ) rates the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. The data is compiled from a survey of approximately 400 purchasing managers in the non-manufacturing sector. On the index, a level above 50 indicates expansion; below indicates contraction.
A higher than expected reading should be taken as positive/bullish for the USD, while a lower than expected reading should be taken as negative/bearish for the USD.
NZD/USD Fundamental Analysis Feb. 3, 2012 Forecast Analysis and Recommendation: (Close of the Asian session )
NZD/USD is trading at 0.8329. The kiwi, showed little strenght today, only reacting to the drop in the USD. The USD found investors moving to other safe risk currencies, as economic data in the US was lackluster. ( see below ). While the manufacturing sector in the US, UK and German showed continued growth.
Economic Data from Europe and the USA on Wednesday:
GBP Nationwide HPI (MoM) -0.2% -0.1% -0.2% Unexpected Drop
CHF Retail Sales (YoY) 0.6% 1.6% 1.8% Unexpected Drop
CHF SVME PMI 47.3 51.8 49.1 Unexpected Drop
EUR French Manufacturing PMI 48.5 48.5 48.5
EUR German Manufacturing PMI 51.0 50.9 50.9 Above Forecast
EUR Manufacturing PMI 48.8 48.7 48.7 Above Forecast
GBP Manufacturing PMI 52.1 50.1 49.7 Above Forecast
EUR CPI (YoY) 2.7% 2.7% 2.7%
USD ADP Employment Change 170K 189K 292K Unexpected Drop
USD ISM Manufacturing PMI 54.1 54.6 53.9 Above Forecast
USD Crude Oil Inventories 4.2M 3.2M 3.6M Increased Inventory
