Forex news for US trading on April 1, 2016:
- March 2016 US Non farm payrolls 215k vs 205k exp
- US March average hourly earnings +0.3% m/m vs +0.2% m/m expected
- NFP review: It's good but is it good enough for the dollar?
- A snapshot of the US employment picture for March 2016
- March 2016 US ISM manufacturing PMI 51.8 vs 50.7 exp
- Univ. of Michigan consumer sentiment March (final) 91.0 vs. 90.5 est.
- RBC March Canadian manufacturing PMI 51.5 vs 49.4 prior
- BOC's Q1 2016 outlook survey looks upbeat
- US construction spending for February -0.5% vs. +0.1% est.
- About that labor force participation rate
- Fed's Mester: Economy has been resilient despite global weakness
- Feds Meister Part II: Continues to expect gradual rate hikes this year
- Fed's Meister: Answers reporters questions...
- US major stock indices end higher on the day/week
- USDJPY making new lows for the day/lows for the week
- CFTC Commitments of Traders: Net speculative positions little changed
- US March total vehicle sales weaker than expectations
- Top five forex seasonals April 2016: #1 It doesn't get any better than this
- Top five forex seasonals April 2016: #2 Commodity bonanza
- Top five forex seasonals April 2016: #3 dollar doldrums
- Top five forex seasonals April 2016: #4 a headache for Draghi
- Top five forex seasonals April 2016: #5 oil it up
- Baker Hughes oil drilling rig count down 10 at 362 in the current week
- The push below technical support in stock indices fails. Rebounds.
- Atlanta Fed GDP estimate 0.7% for 1Q
- Spain maintains BBB+/A-2 rating from S&P
- European stocks are the fools on the first day of April
- The dollar's back in the saddle and taking everyone else to the cleaners
- March 2016 US Markit manufacturing PMI final 51.5 vs 51.5 exp
The US unemployment statistics showed continued solid employment gains. NFP rose by 215K (205K est). Hourly earnings rose by +0.3% (+0.2% est). The Unemployment rate did move up to 5.0% from 4.9% though. Revisions to prior months were negligible. Later, the ISM manufacturing survey turned to the expansionary side and was higher than expectation (51.8 vs 50.7 est). US Construction spending was weaker than expectations but the prior month was revised higher.
So although the data was solid, it was pretty much as expected and the dollar traded accordingly.
The EURUSD came into the NFP better bid. The price traded at the highest level since October 2015. The headline came out and the price quickly moved to lower. Choppy downward action sent the pair lower and when the ISM data came out higher, it looked like the downside would be the way to go. However, support against the underside of the broken trend line at 1.1325 stalled the fall and a squeeze higher was on as London traders headed for the exits. The EURUSD was also largely supported today by a stronger EURGBP. It moved above the 0.8000 level in trading today and that helped the EURUSD maintain a bid.
If the EURUSD maintained a bid, the GBPUSD did not (it was the weakest currency for the day - see the snapshot of end of day changes of the major currency pairs).. Earlier in the London session, a weaker PMI manufacturing release out of the UK and a stronger PMI out of Europe, had traders thinking "Sell GBP". So they did. The pair fell back below a full menu of MA lines and retracement levels. The final MA broken was the 200 hour MA on the 4 hour chart very near the 1.4200 level. ON Tuesday, the GBPUSD bottomed not far away at 1.4194. Although the momentum took the price down to a low of 1.4170, the pair was able to climb back above the 1.4200 level and settled between 1.4200 and 1.4234 for the NY afternoon session.
The USDJPY was a strange one today. Better data/stronger stocks should have sent the pair higher, but by the end of the day, the pair was trading at new session AND new week lows at 111.57. The 111.64 price level is the 50% midpoint of the USDJPY range since 1998 and that is where the price is settling today. Next week, the market may look to move away. What do you think? Higher or lower from the midpoint at this time next week?
The AUDUSD, USDCAD and NZDUSD price action looks similar. Each saw the dollar get stronger after the Employment, then retrace nearly the entire dollar gain. Overall, the AUD was the strongest of the three. The NZD was the weakest but off the lows. Oil prices were down over 4.46% but the RBC Manufacturing PMI turned above the 50.0 level (51.5 vs 49.4 est) and the BOC Q1 outlook survey looked upbeat. The market ignored the lower oil prices and sent the USDCAD down instead. The pair closes near NY session lows.
That about does it for me and for the week. Speaking on behalf of the staff of FXL, we thank you for your support and wish you all a happy, peaceful and health weekend.
PS. If you did not catch Ryan's masterful April Fools post, you can find it by clicking HERE. He is so British....
