Not much happening in the major currencies to start the new week. Friday's US jobs report here reconfirmation of a 25 bps rate cut by the Fed this month. And that's basically the signal that market players have to work with right now. The likelihood of such a rate cut is now ~86%.
The headline non-farm payrolls figure may be “strong” but again, it looks skewed by a poor showing in October. That was largely due to bad weather from Hurricane Milton and the Boeing strike. At the same time, the unemployment rate rose to equal the highest level since July and is 0.8% above the cycle low. That reaffirms a weak labor market.
On balance, he reaffirms his opposition to Fed cuts again before pausing to reassess conditions under a Trump presidency next year. This week's US CPI report is the next major risk event to watch but shouldn't rule out any big surprises too much.
For now though, market players may have to wait on that to solidify their convictions before the Fed next week.
USD/JPY continues to stay in and around 150.00 while EUR/USD looked briefly above 1.0600 after Friday's jobs report but is now back down to around 1.0550. The earlier low moved to test the confluence of its major hourly moving average at 1.0536 currently.
Additionally, AUD/USD remains pinned near August lows while flirting with a firmer break below 0.6400. And USD/CAD seems to want a big technical break above 1.4100. So, that's one card to look out for in a December trade that might be interesting to enter next year.
Source link
