The dollar remained near three-month highs against the other major currencies on Thursday, as hopes for a December rate hike in the U.S. continued to support the greenback and investors awaited the release of U.S. jobs data on Friday.
The greenback remained supported after Federal Reserve Chair Janet Yellen said on Wednesday that a December rate hike is a "live possibility," depending on the data.
But the dollar lost part of his strength on Thursday afternoon, after the U.S. Department of Labor reported that the number of individuals filing for initial jobless benefits in the week ending October 31 increased by 16,000 to 276,000, from the previous week’s total of 260,000.
Investors are now turning their attention to today's U.S. nonfarm payrolls report, for further indications on the strength of the job market.
The euro rose moderately on Thursday, one day after crashing to three-month low, as currency traders look ahead to today's key U.S. jobs report, for hints on whether the Federal Open Market Committee could hike interest rates before the end of 2015.
For the most part, currency traders were hesitant to make any major moves ahead of Friday's October jobs report from the U.S. Department of Labor's Bureau of Labor Statistics.
The Labor Department is expected to report that nonfarm payrolls increased by 190,000 last month, after an extremely soft gain of 142,000 in September. Analysts also expect the unemployment rate to fall 0.1% to 5.0% and average hourly earnings to tick up by 0.2 to 0.2%.
Pivot: 1.091Support: 1.083 1.081 1.0775Resistance: 1.091 1.0945 1.0985Scenario 1: Short positions below 1.091 with targets @ 1.083 & 1.081 in extension.Scenario 2: Above 1.091 look for further upside with 1.0945 & 1.0985 as targets.Comment: As long as the resistance at 1.091 is not surpassed, the risk of the break below 1.083 remains high.
Gold
Gold prices struggled near seven-week lows on Thursday, as market players shifted their focus to Friday's U.S. nonfarm payrolls report, for further indications on the strength of the economy and the likelihood of a near-term rate hike.
A strong nonfarm payrolls report is likely to add to already growing expectations for a December rate hike, while a weak number could undermine the argument for an early rate increase. Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Gold prices hold mostly steady also in Asia on Friday, with reluctance from investors to take positions ahead of this afternoon U.S. jobs data, seen as key for a decision by the Federal Reserve to raise rates next month.
Pivot: 1114Support: 1098 1093 1088Resistance: 1114 1121 1130Scenario 1: Short positions below 1114 with targets @ 1098 & 1093 in extension.Scenario 2: Above 1114 look for further upside with 1121 & 1130 as targets.Comment: As long as 1114 is resistance, likely decline to 1098.
WTI Oil
Oil prices fell on Thursday, under pressure from rising supplies both in the United States, where inventories gained for a sixth straight week, and in Europe, where physical crude prices are nearing five-month lows.
"The difficulty right now for the market is being able to lift off from the current floor that it has found in the mid $40s on a WTI basis," as said by BNP Paribas (PA:BNPP)' global head of commodity strategy Harry Tchilinguirian.
Furthermore, ample supply of North Sea crude oil has pushed prices to their lowest since June.
But crude oil prices edged up on Friday, after falling over 2% the previous session, with analysts saying oversupply and a strong dollar would continue to weigh on fuel markets.
Pivot: 46.19Support: 44.88 44.44 43.92Resistance: 46.19 46.65 47.16Scenario 1: Short positions below 46.19 with targets @ 44.88 & 44.44 in extension.Scenario 2: Above 46.19 look for further upside with 46.65 & 47.16 as targets.Comment: As long as 46.19 is resistance, likely decline to 44.88.
U.S. stocks edged lower on Thursday, as investors digested mixed tech and healthcare earnings, a day ahead of Friday's U.S. jobs report.
Energy shares dragged more than other sectors as crude prices fell, but also the healthcare sector sank, after the U.S. launched a probe into drug prices increases, seeking documents from four drug makers, including Valeant.
Overall declines were limited by a rise in Facebook (O:FB), which shares jumped up 4.6% and gave the biggest boost to the S&P and Nasdaq.
Never the less, the Dow Jones industrial average closed the day down 0.02%, the S&P 500 lost 0.11%, to 2,099.93 and the Nasdaq dropped 0.29%.
Investors are now awaiting today's crucial monthly nonfarm payrolls data, to gauge if the Federal Reserve will lift rates next month, a likelihood Fed Chair Janet Yellen alluded to on Wednesday. It is expected to show 205,000 jobs added in October, rebounding after two months of weakness.
Pivot: 1990 Support: 1990 1900 1867 Resistance: 2120 2135 2180 Scenario 1: Long positions above 1990 with targets @ 2120 & 2135 in extension. Scenario 2: Below 1990 look for further downside with 1900 & 1867 as targets. Comment: The RSI is mixed and calls for caution.