The dollar moves higher against the euro and the yen early on Friday, as markets await for the release of a highly-anticipated U.S. jobs report later in the day. Investors will be focusing on Friday's U.S. nonfarm payrolls report for September, which could help to provide clarity on the likelihood of a near-term interest rate hike by the Federal Reserve. The report comes shortly after the U.S. Department of Labor reported that the number of individuals filing for initial jobless benefits in the week ending September 26 increased by 10,000 to 277,000 from the previous week’s total of 267,000, compared to expectations for a 3,000 rise.
In the European front, the single currency found some support after European Central Bank President Mario Draghi said in a speech Thursday that growth in the euro zone is picking up thanks to the central bank’s accommodative monetary policy. In addition, manufacturing data in China fell 0.1 to 47.2 in September, its lowest level in six and a half years. The manufacturing sectors in Germany and the U.K., as well as the euro zone as a whole expanded at a slower rate than expected last month adding to worries over a global economic slowdown.
Elsewhere, Israeli prime minister Benjamin Netanyahu told the global community he believes the Iran Nuclear Deal will have dire effects on Israel and increases the likelihood of creating a war in the region. Addressing the United Nations General Assembly in New York, Netanyahu criticized a group of Western Powers for reaching an accord with Iran earlier this summer.
EUR/USD posted modest gains on Thursday, as disappointing manufacturing data around the world weighed on the major currencies resulting in heightened fears of a deepening global recession.
The currency pair traded between a low of 1.1136 and a high of 1.1208, before settling 0.15% higher. The Institute for Supply Management said its index of National Factory Activity fell to 50.2 last month, below expectations for a reading of 50.5. In addition, the U.S. Department of Labor said on Thursday that initial jobless claims rose by 10,000 last week to 277,000. Although weekly jobless claims rose at a slightly higher rate than expected, they still remain near 15-year lows. Currency traders now appear hesitant to make any major moves ahead of Friday's critical U.S. jobs report for the month of September.
Pivot:1.114
Support:1.1141.11151.11
Resistance:1.1211.1241.1265
Scenario 1:Long positions above 1.114 with targets @ 1.121 & 1.124 in extension.
Scenario 2:Below 1.114 look for further downside with 1.1115 & 1.11 as targets.
Comment:Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
Gold
While supported by increased uncertainty and political turmoil in Syria, gold prices continue to drop for the week, ending Thursday relatively flat after mixed U.S. economic data on unemployment claims and manufacturing. The price of the metal is moving lower early on Friday, as investors await a key September jobs report on Friday for further indications on whether the Federal Reserve could raise interest rates over the next several months. In its September monetary policy statement, the Federal Open Market Committee indicated that it would like to see improvements in the labor market before it raises short-term interest rates. An interest rate hike is viewed as bearish for gold which struggles to compete against high-yield bearing assets.
Pivot:1119
Support:110310991092
Resistance:111911241129
Scenario 1:Short positions below 1119 with targets @ 1103 & 1099 in extension.
Scenario 2:Above 1119 look for further upside with 1124 & 1129 as targets.
Comment:As long as 1119 is resistance, likely decline to 1103.
WTI Oil
Crude prices ended Thursday slightly lower, as fighting in Syria intensifies, but remained on course to end the week largely unchanged. Hurricane Joaquin, which on Thursday had prompted fears of storm damage to U.S. East Coast oil installations, was downgraded and is now seen as less likely to pose a major threat, the U.S. National Hurricane Center said. Oil traders will be focusing on the U.S. employment report for further indications on the direction of the dollar, as well as on the industry research group Baker Hughes (NYSE:BHI) which said late Friday that the number of rigs drilling for oil in the U.S. decreased by four last week to 640, the fourth straight weekly decline.
Pivot:45.78
Support:44.6344.343.95
Resistance:45.7846.3346.9
Scenario 1:Short positions below 45.78 with targets @ 44.63 & 44.3 in extension.
Scenario 2:Above 45.78 look for further upside with 46.33 & 46.9 as targets.
Comment:The RSI broke below a bullish trend line.
Twitter (NYSE:TWTR)
Twitter shares fell by almost 7% on Thursday after rising by approximately 5% on Wednesday. The social network had climbed on reports co-founder Jack Dorsey will assume the position of permanent CEO after acting as interim chief since June. Former CEO Dick Costolo stepped down in early June. In general, high-momentum tech stocks were among the worst performers on markets. Among the most-active losers were, Apple (NASDAQ:AAPL), Google (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT), and Intel (NASDAQ:INTC).
Pivot: 28.4
Support: 22 21 20
Resistance: 28.4 30.2 31.3
Scenario 1: the downside prevails as long as 28.4 is resistance.
Scenario 2: above 28.4, look for 30.2 and 31.3.
Comment: the RSI is below 30. It could either mean that the stock is in a lasting downtrend or just oversold and therefore bound to retrace