Pulse of the Market
- Highly anticipated U.S non-farm payrolls report is due for release in today’s trading session
- Euro Zone inflation unexpectedly increased at an annualized pace of 2.6% in March
- The GfK consumer confidence survey held steady at -28 for the second month in March
- The Canadian economy expanded by 0.5 percent in the month of January
The Greenback weakened against the Euro and commodity currencies as safe haven flows continued to ease out of low yielding currencies including the U.S Dollar. Considering the big event risks on the calendar today, it has been a relatively quiet day in the foreign exchange market. NFP is the most market moving event risk for the U.S Dollar and can cause unusual volatility for many currency pairs. The current forecast for non-farm payrolls projected by individual economists range from a low of 150k to a high of 295k. The NFP report could be explicitly positive for the Greenback if payrolls exceed 275k, the unemployment rate remains unchanged or improves along with an upward revision to the prior month’s report. If non-farm payrolls are strong but the unemployment rate ticks higher, the rally in the U.S Dollar could be limited. Yesterday’s Chicago PMI number showed manufacturing activity in the Chicago region slowed in the month of March. The Single Currency ended yesterday’s trading session higher against the U.S Dollar. The Irish government released the results of its latest stress tests and it was not nearly as bearish for the Euro as everyone had feared. However the gains in the Euro were limited in the last hour of the trading session as Portugal announced that they will be dissolving their government and holding elections in June. The Euro passed this latest test with only a minor setback and now investors may be able to focus exclusively on the prospect of a rate hike. The Cable lost ground against all of the major currencies yesterday, hitting a 5 month low against the Euro. As ECB rate hike expectations continue to climb, the Cable shed against the Euro in the midst of renewed fundamental concerns. Yesterday’s GfK Consumer Confidence survey held steady at -28 for the second month, marking the lowest reading since March of 2009. The Japanese Yen sold off against all of the major currencies. On the economic calendar, the unemployment rate hit a 2 year low of 4.6% while retail sales and preliminary industrial production both beat expectations. Australian and the Canadian Dollar have continued to extend their gains against the U.S Dollar.
| Time(GMT) | Economic Release | IM | Actual | Forecast | Prior |
| 07:15 | Switzerland Retail Sales (Real) (YoY) (FEB) | Medium | | | -2.6% |
| 07:30 | Switzerland SVME-Purchasing Managers Index (MAR) | Medium | | 62.5 | 63.5 |
| 07:55 | German Purchasing Manager Index Manufacturing | Medium | | 60.9 | 60.9 |
| 08:00 | Euro Zone Purchasing Manager Index Manufacturing | Medium | | 57.7 | 57.7 |
| 08:30 | U.K Purchasing Manager Index Manufacturing (MAR) | Medium | | 60.9 | 61.5 |
| 09:00 | Euro-Zone Unemployment Rate (FEB) | Medium | | 9.9% | 9.9% |
| 12:30 | U.S Change in Non-farm Payrolls (MAR) | High | | 190K | 192K |
| 12:30 | U.S Unemployment Rate (MAR) | High | | 8.9% | 8.9% |
| 14:00 | U.S ISM Manufacturing (MAR) | High | | 61 | 61.4 |
Euro
The Single Currency traded above 1.4200 in yesterday’s trading session on continued strength with sentiment towards the Euro is still very strong. EUR/GBP hit multi-month highs above 0.8850 before settling slightly lower yesterday. On the economic docket, February Retail Sales weakened at -0.3% vs. 0.4% previously. Overall the EUR/USD traded with a low of 1.4115 and a high of 1.4232 before closing the day around 1.4155 in the New York session.
Yen
The Japanese Yen pushed above 83.00 Yen yesterday in another unyielding move for the major with an uptrend possible if more technical levels can be broken in today’s trading session with the U.S Non-Farm Payrolls data. Crosses continued to trade higher with EUR/JPY extending week gains above 118.00 Yen. Overall the USD/JPY traded with a low of 82.55 and a high of 83.21 before closing the day around 83.12 in the New York session.
British Pound
The British Pound was higher pushing above 1.6100 but found heavy resistance and reversed back to support at 1.6040. March House Price Index fell -0.1% vs. 0.3% previously and as expected. While Cable holds above 1.6000 tentative bottom may be in place but the market is still very uncertain on the U.K going forward. Overall the GBP/USD traded with a low of 1.6015 and a high of 1.6150 before closing the day at 1.6026 in the New York session.
Canadian Dollar
The Canadian Dollar continued to extend its gains against the U.S Dollar. The Canadian economy expanded by 0.5 percent in January, which was the same pace of growth experienced in December. On an annualized basis, GDP held steady at 3.3 percent. This was the fourth straight month of growth in the Canadian economy. Overall the USD/CAD traded with a low of 0.9681 and a high of 0.9727 before closing the day at 0.9704 in the New York session.
Euro-Yen
EUR/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also issuing a bullish stance. The RSI is above 69 and lies above the neutral zone. Overall, the cross has gained 0.50%.
Sterling-Yen
Currently GBP/JPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing bullish and MACD is also indicating a bullish stance. The RSI is above 59 reading and lies above the neutral zone. The pair has lost 0.01%.
Aussie-Yen
Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic gives bullish and MACD is also indicating a bullish stance. The RSI is above 69 reading and lies above the neutral region. The cross has gained 0.32%.
Euro-Sterling
This cross is trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bullish and MACD is also issuing a bullish signal. The RSI is above 68 reading and lies above the neutral region. The pair has gained 0.50%.
Sterling-Swiss
This cross is trading above 14 and below 50, 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is also indicating a bullish tone. The RSI is above 45 and lies below the neutral region. The pair has lost 0.18%.
Appendix
| Daily Pivot Points | |||||||
| | Trading Range | | |||||
| Contract | S3 | S2 | S1 | Pivot | R1 | R2 | R3 |
| EUR/USD | 1.3986 | 1.4050 | 1.4103 | 1.4167 | 1.4220 | 1.4284 | 1.4337 |
| USD/JPY | 82.05 | 82.30 | 82.71 | 82.96 | 83.37 | 83.62 | 84.03 |
| GBP/USD | 1.5842 | 1.5929 | 1.5977 | 1.6064 | 1.6112 | 1.6199 | 1.6247 |
| USD/CHF | 0.9076 | 0.9100 | 0.9147 | 0.9171 | 0.9218 | 0.9242 | 0.9289 |
| USD/CAD | 0.9635 | 0.9658 | 0.9681 | 0.9704 | 0.9727 | 0.9750 | 0.9773 |
| EUR/JPY | 115.68 | 116.20 | 116.93 | 117.45 | 118.18 | 118.70 | 119.43 |
| GBP/JPY | 131.12 | 131.78 | 132.50 | 133.16 | 133.88 | 134.54 | 135.26 |
| CHF/JPY | 89.30 | 89.63 | 90.01 | 90.34 | 90.72 | 91.05 | 91.43 |
| AUD/JPY | 84.35 | 84.74 | 85.30 | 85.69 | 86.25 | 86.64 | 87.20 |
| EUR/GBP | 0.8709 | 0.8742 | 0.8786 | 0.8819 | 0.8863 | 0.8896 | 0.8940 |
| EUR/CHF | 1.2863 | 1.2896 | 1.2955 | 1.2988 | 1.3047 | 1.3080 | 1.3139 |
| GBP/CHF | 1.4456 | 1.4540 | 1.4637 | 1.4721 | 1.4818 | 1.4902 | 1.4999 |
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