Dollar Rallies On Jobs Data - Powell Up Next
JOLTS Boost for USD
The US Dollar is pushing higher again today on the back of yesterday’s better-than-forecast JOLTS jobs number. The data showed 7.74 million jobs were created last month, up from 7.3 million the month prior and above the 7.5 million the market was looking for. Ahead of the keenly awaited NFP release on Friday, the data has been taken as a bullish sign. Looking ahead, attention today will now turn to the ADP release later, forecast at 152k from 233k prior. Given the lower forecast, there is room for an upside surprise today which should further boost USD into Friday if seen.
Powell to Speak
Following that release, focus will then shift to Fed chairman Powell who speaks this afternoon. Traders will be looking for further colour on December rate cut chances and Powell’s comments could spur fresh USD volatility if we hear anything definitive.
NFPs On Watch
Looking ahead to Friday, the market is looking for the headline NFP number to rebound to 218k from just 12k prior. Given that this forecast is well above the roughly 180k average of the last 12 months, there is room for disappointment on Friday, which could hamper USD upside if seen. If The data satisfies, or even tops, forecasts, however, USD is likely to push firmly higher into next week. Thew big question is how much a strong reading will impact December rate cut chances? We’ve heard some dovish commentary from Fed officials this week in support of further easing though a further cut this month looks far from a sure thing. As such, rate cut chances are likely to fall on a strong number, keeping USD well bid near-term.
Technical Views
DXY
The correction lower in DXY has found strong support into the 105.97 level for now. While price holds above this level and the broken bear trend line, focus is on a fresh test of the 107.25 level and a continuation higher. Below here, 104.05 is the next support to watch.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.